Glossary · Economy
Consumer price index (CPI)
The consumer price index (CPI) tracks the prices of a basket of goods and services that households buy; its change over a year is the inflation rate.
Also called: CPI, CPI-U, consumer prices, price index
To September 2026.
Oct 2026; 100 = the average of 1982–84.
3.2% a year on average, to Oct 2026.
In plain words
Every month, staff of the US Bureau of Labor Statistics (BLS) note the prices of tens of thousands of items in stores, online and by phone: apples, rent, haircuts, car insurance, concert tickets. They combine them into one number, the consumer price index. Its percent change over 12 months is the inflation rate you hear about.
Items count by how much households spend on them. Housing is by far the biggest part, then transportation and food: if rent rises 5% it moves the CPI far more than a 5% rise in the price of salt. Over the 12 months to Sep 2026, shelter prices changed by +3.2%, used cars by −3.3% and airfares by +22.4%.
The index level is a ratio to a base period: 100 is the average price level of 1982–84. In Oct 2026 it stood at 337.5, so the same basket cost 3.37 times as much as then.
Example
A three-item price index
A real CPI has hundreds of item groups; three are enough to see how it works.
- A household spends $600 a month on rent, $300 on food and $100 on gasoline: $1,000 in all. Weights: 60%, 30% and 10%.
- A year later rent is up 5%, food up 2% and gasoline down 10%.
- The same basket now costs $630 + $306 + $90 = $1,026.
- Index: 100 → 102.6. Inflation: 2.6%, even though one price fell.
That is the CPI in miniature: a weighted average of price changes, where rent counts most because it is the biggest bill.
One level deeper
There are several CPIs. The headline one is CPI-U, for all urban consumers, about nine in ten Americans. CPI-W, for wage earners, is used to raise Social Security benefits each year. The chained CPI, which allows for people switching to cheaper goods, is used to adjust tax brackets.
The basket is updated: BLS revises the weights every year and adjusts for quality, so a laptop that is twice as fast at the same price counts as a price cut. Some people think this hides inflation; studies have mostly found the opposite, a small overstatement.
Over the long run the CPI is how we know what a dollar was worth. Since 1913, US consumer prices rose 34.4 times, so $1 in 1913 bought about as much as $34.44 does today.
US consumer prices since 1913
The index on a log scale, so equal steps mean equal percentage rises. Prices fell in the early 1920s and early 1930s, surged in the 1940s and 1970s, and, measured by yearly averages, have risen every year since 1955 except 2009.
The numbers behind the chart
| Date | CPI-U (1982–84 = 100) |
|---|---|
| Jan 1913 | 9.8 |
| Dec 1920 | 19.4 |
| Dec 1930 | 16.1 |
| Dec 1940 | 14.1 |
| Dec 1950 | 25.0 |
| Dec 1960 | 29.8 |
| Dec 1970 | 39.8 |
| Dec 1980 | 86.3 |
| Dec 1990 | 133.8 |
| Dec 2000 | 174.0 |
| Dec 2010 | 219.2 |
| Dec 2020 | 260.5 |
| Dec 2022 | 296.8 |
| Dec 2023 | 306.7 |
| Dec 2024 | 315.6 |
| Dec 2025 | 324.1 |
| Oct 2026 | 337.5 |
Why it matters
It is one of the most watched numbers in the world’s biggest economy: markets move on its release, and the Federal Reserve follows it closely.
It keeps money values real: Social Security, tax brackets, many wages and rents, and inflation-protected bonds are tied to it.
It turns old prices into today’s: our inflation calculator uses it for any two months since 1913.
A common mistake
Myth: The CPI is the price of the things I buy.
In fact: It is an average for urban households as a whole. A renter who drives a lot and a homeowner who works from home can face very different inflation from the same CPI.
Questions people ask
When is the CPI released?
Monthly, by the Bureau of Labor Statistics, usually in the second week of the following month, at 8:30 in the morning, Eastern time.
What is the difference between CPI and core CPI?
Core CPI leaves out food and energy, whose prices jump around, to show the underlying trend. Core CPI inflation was 2.6% over the 12 months to Sep 2026.
What does a CPI of 300 mean?
That the basket costs three times what it cost on average in 1982–84, the base period (= 100). It is 337.5 now (Oct 2026).
Read more on BigCapital
About the numbers
- The numbers on this page are recalculated from the data every night; the sources are listed at the end of the page.
- US recessions (NBER business cycle dates): National Bureau of Economic Research (NBER), Business Cycle Dating Committee: US Business Cycle Expansions and Contractions.
- CPI: airline fares: U.S. Bureau of Labor Statistics, Consumer Price Index, series CUSR0000SETG01; retrieved from FRED, Federal Reserve Bank of St. Louis.
- Consumer price index, all items (CPI-U): U.S. Bureau of Labor Statistics, Consumer Price Index, series CPIAUCSL; retrieved from FRED, Federal Reserve Bank of St. Louis.
- Consumer price index less food and energy (core CPI): U.S. Bureau of Labor Statistics, Consumer Price Index, series CPILFESL; retrieved from FRED, Federal Reserve Bank of St. Louis.
- Consumer price index, all items (CPI-U), not seasonally adjusted: U.S. Bureau of Labor Statistics, Consumer Price Index, series CPIAUCNS; retrieved from FRED, Federal Reserve Bank of St. Louis.
- CPI: rent of primary residence: U.S. Bureau of Labor Statistics, Consumer Price Index, series CUSR0000SEHA; retrieved from FRED, Federal Reserve Bank of St. Louis.
- CPI: shelter: U.S. Bureau of Labor Statistics, Consumer Price Index, series CUSR0000SAH1; retrieved from FRED, Federal Reserve Bank of St. Louis.
- CPI: used cars and trucks: U.S. Bureau of Labor Statistics, Consumer Price Index, series CUSR0000SETA02; retrieved from FRED, Federal Reserve Bank of St. Louis.
- This page explains a term. It is not investment advice.