Watch money lose its weight.

Inflation is the rate at which the general level of prices rises over time. Most countries measure it using a consumer price index (CPI) — a basket of goods and services a typical household buys, priced monthly. The annual inflation rate is how much that basket's cost changed compared with the same month a year ago. The US Bureau of Labor Statistics (BLS), Eurostat, and UK ONS are three of the world's most-cited producers of consumer price data.

The Consumer Price Index (CPI-U) tracks what urban consumers pay for a fixed basket of goods. The PCE price index (Personal Consumption Expenditures) uses a broader spending universe and adjusts its basket as consumers substitute goods — making it the Federal Reserve's preferred inflation gauge, with a 2% PCE target. CPI-U tends to run 0.3–0.5 percentage points above PCE. The US Bureau of Economic Analysis (BEA) publishes monthly PCE data.

Annual CPI inflation rates come from the World Bank World Development Indicators (WDI), indicator FP.CPI.TOTL.ZG, which aggregates data from national statistical offices. Monthly rates come from the IMF Global Economic Monitor (GEM). US monthly data traces back to the BLS CPI-U, UK data to the ONS, and euro-area data to Eurostat's HICP.

Falling inflation means prices are rising more slowly, not that they're coming down. Prices only fall when inflation turns negative — that's deflation. A price level that rose 8% last year and 3% this year is still 11% above where it was two years ago. This compounding effect on purchasing power is documented in long-run data on Our World in Data and the World Bank CPI index series.

The 12-month rate compares prices in one month with the same month a year earlier — the most commonly cited "current" inflation figure. The annual average is the mean of all 12 monthly year-on-year rates in a calendar year — smoother and better for long-run comparisons. The FRED database at the St. Louis Fed publishes both series for the US back to 1947. The World Bank WDI uses annual averages.

Use like-for-like measures: compare national CPIs with each other, or compare HICP figures within the EU. Never mix a national CPI with an HICP on the same chart — they have different basket compositions and methodologies. For the most comparable global view, the World Bank WDI FP.CPI.TOTL.ZG uses a consistent methodology across 190+ countries. The IMF World Economic Outlook publishes GDP-weighted regional aggregates for further context.

Divide the later CPI index value by the earlier one and subtract 1. If the CPI index was 100 in 2010 and 140 in 2026, cumulative inflation is 40%. The World Bank CPI index series (FP.CPI.TOTL, base 2010=100) lets you compute this for nearly every country since 1960. Our Calculators page does this automatically.

Statistical agencies revise their figures — sometimes months after initial publication — when methodologies change, surveys are restated, or seasonal adjustment factors are updated. The IMF World Economic Outlook and World Bank data portal both carry revision notes. We always show the current official figure.