Consumer price index for the year. How is inflation calculated?

The consumer price index for goods and services (CPI) is one of the main indicators that characterize inflationary processes in the country. The CPI is used when recalculating macroeconomic indicators from current prices to comparable prices. This indicator is also used to characterize the change in consumer spending on goods and paid services in the current period compared to the previous (base) period under the influence of changes in prices for these goods and services in individual subjects of the Russian Federation and in the whole country. Based on the CPI, in particular, the value per capita and for the main socio-demographic groups is calculated. Using CPI indicators, employers can produce a mandatory one (Letter of Rostrud dated April 19, 2010 No. 1073-6-1, Definition of the Constitutional Court dated November 19, 2015 No. 2618-O).

Consumer Price Index: formula

The CPI characterizes the change over time in the general level of prices for goods and services purchased by the population, and is calculated as follows:

C 1 - the cost of a fixed list of goods and services in the prices of the current period;

C 0 - the cost of a fixed list of goods and services in the prices of the previous (base) period.

The set of goods and services on the basis of which the CPI is calculated is the same for all constituent entities of the Russian Federation and represents a selection of groups of goods and services most frequently consumed by the population developed by Rosstat. Such a set consists of food products, non-food products and services.

How often is the CPI determined?

The CPI is calculated on a monthly basis within the framework of the Federal Statistical Work Plan, approved by Government Decree No. 671-r dated May 6, 2008. The methodology for calculating the CPI was established by the Order of Rosstat dated December 30, 2014 No. 734.

Information about the approved CPI is posted on the Internet on the official website of Rosstat gks.ru.

The CPI value in 2017 can be found on the website in the "Indices" section or in the ATP ConsultantPlus.

Consumer price indices for 2018 will also be posted on the Rosstat website as such coefficients are approved; for January 2018, such coefficients will be available no earlier than February 2018.

In December, consumer prices for goods and services rose by 0.8% or more in 7 constituent entities of the Russian Federation (except for the autonomous districts that are part of the region). A significant increase in prices was noted in the Stavropol Territory, the republics of Kalmykia and North Ossetia-Alania - 0.9-1.0% as a result of a rise in food prices by 1.5-2.2%.

At the same time, in the Republic of Adygea, consumer goods and services fell in average by 0.2%, mainly due to a decrease in food prices by 0.4%.

In Moscow, the consumer price index for the month amounted to 100.4% (from the beginning of the year - 103.8%), in St. Petersburg - 100.3% (from the beginning of the year - 103.7%).

In December, among the observed types of fruits and vegetables, cucumbers and tomatoes went up significantly - by 24.6% and 20.8%, respectively, grapes - by 7.7%, bananas - by 4.0%. At the same time, oranges became cheaper by 5.7%, garlic, beets and nuts - by 0.3-1.7%.

In the group of fish products, prices for domestic salmon caviar increased by 3.3%, for cut salmon fish, canned natural fish and with oil by 0.8%.

Among other food products, margarine, national cheeses and brynza rose in price by 1.1%, beef liver, whole pasteurized drinking milk, curd cheeses glazed with chocolate - by 0.7%.

Almost all types of pasta and cereals showed a decrease in prices. Thus, buckwheat became cheaper by 3.8%, peas and beans - by 1.4%. At the same time, millet prices increased by 0.6%.

Poultry meat, boneless pork, wheat flour, canned vegetables, chocolate, chocolate sweets and vodka became cheaper by 0.2-0.6%.

The cost of a conditional (minimum) set of food products per month on average in Russia at the end of December 2017. amounted to 3749.6 rubles and increased by 0.8% compared to the previous month (since the beginning of the year - by 1.6%).

Consumer price index, CPI (Consumer price index, CPI) is a price index that is calculated for a certain group of goods and services that determine the composition of the consumer basket of one resident of the country and is calculated for a certain period of time.

For example, in the United States, the consumer price index is calculated by taking as a basis 265 goods and services taken in 85 cities of the country. In Russia, when calculating, a consumer basket is taken, the composition of which is approved by Federal Law No. 44-FZ “On the consumer basket as a whole in the Russian Federation”. It includes both food, non-food products, and various kinds of services.

Thus, the consumer price index is the ratio of the entire consumer basket of the base year, which is estimated at the prices of the current year, to the consumer basket for the base year, which is estimated at the prices of the base year.

If we assume that the consumer basket includes only three types of goods, then an example of calculating the indicator will look like this, as shown in the table below.

The consumer price index is one of the most widely used price indices and plays an important role in the economy because is the base value serving as an impetus for the recalculation of wages, social benefits and other payments that should occur regularly and automatically, for example, every quarter, annually or every six months, by organizations hiring employees in their staff.

The important role of the consumer price index implies the need to create in the economy a unified methodology for calculating this indicator, which in due time would reflect the degree of change in the price level. For example, only a small and limited number of goods that fall under the minimum level of consumption will be taken into account when calculating the CPI. Based on this, the price change index will be much smaller and wage growth will not compensate for inflation, which may affect the reduction in incentives to work. A similar situation can happen if, for example, the consumer basket includes such goods that were produced within the country. In such a situation, with a high level of centralization, a redistribution of the rise in prices for consumer goods is sure to take place. For example, between such goods as Kalashnikov assault rifles and tarpaulin boots, the prices for which the country's government can artificially reduce.

The calculation method itself also plays an important role. For example, consider the following method for calculating the consumer price index, which is mathematically correct and even recommended for calculating the CPI, but gives a slightly different result than in the case shown above. The formula looks like this:

Having determined the share of each group of goods that are part of the usual consumer basket and substituting prices into the formula, we get:

In the calculation of indices, statistical accuracy entails the creation of a single base, and therefore the consumer price index in a country is based on a single base, which is the base year's production volume or single shares of goods in the consumer basket. As a result, the CPI does not capture the impact of a change in price on a change in the share of consumption of any good. In addition, the price index cannot estimate what percentage of the price increase is the qualitative improvement of the product as such. For example, a 1960 model car and a 1990 car differ significantly in their quality characteristics.

Consumer Price Index (CPI - Consumer Price Index) - an indicator of rising prices for goods and services.

This is the most popular formula for determining inflation/deflation. The CPI is a weighted average of the costs of goods and services purchased by the average household.

When determining the CPI, the so-called statistical shopping basket is taken into account. Its content is determined by the Department of Statistics and approved at the state level. The consumer price index is calculated by the formula:

• Kr is the value of the market basket for a certain year;
• Kb is the value of the market basket at the time of counting.

The consumer price index is measured in almost every country, but the methods of calculation differ. In poor countries, residents spend a significant portion of their income on food, and this has a significant impact on the CPI. On the contrary, in highly developed countries, differences in consumption patterns lead to the need to develop their own calculation scheme. For example, in the Japanese price index, fish has a higher weight, and in French, wine consumption.

Basket contents

The basket consists of various product groups, which cover about 400 items. It represents the shopping basket of a typical consumer. The list includes food, fuel, clothing, real estate, medical and legal fees, public transport costs, repairs, interest on loans, etc.

The consumer price index is very important for the economy. He appears as:

• inflation indicator;
• a measure of the purchasing power of money;
• part of the formula when calculating wage indexation (cost of living adjustments);
• indicator for the harmonization of monetary and fiscal policies.

The price index for consumer goods and services is one of the most important indicators of fundamental (macroeconomic) analysis. In monetary policy, it is used by countries in which the central bank applies a strategy of direct inflation targeting. There are also other indicators that determine price stability in the economy, such as the gross product deflator. However, it follows from the conducted studies that the CPI more fully diagnoses inflation compared to other calculation methods.

Problems detecting changes in CPI

For a more accurate calculation of the CPI, the following factors should be taken into account in the calculations:

• The emergence of new products. This means more choice for consumers. Greater variety of products increases the value of money. This means that people need less financial resources to maintain their current standard of living. However, the price index is based on a fixed basket of goods and services, so it does not reflect changes in the purchasing power of money.
• Substitution of goods. Product prices fluctuate to varying degrees. Some decline more, others less, and still others rise. Consumer demand, due to this price elasticity, can vary, as the buyer limits the purchase of goods that have risen in price and increases the purchase of cheaper items. If the CPI is calculated for a fixed basket, it does not take into account the fact that consumers can buy substitute goods.
• No change in quality. The deterioration of the quality of goods leads to a fall in the purchasing power of money, even if the price of the product has not changed. Similarly, as the product improves, the cost of funds increases.

Another difficulty in calculating the consumer price index is the long-term comparison. The problem stems from the fact that many of the goods and services present in the current basket did not exist in the past (eg microwave ovens, mobile phones, etc.). Some product items (for example, computers) are included in the list, but the statistics do not take into account that the equipment currently being produced is different from its previous generations, which may affect its cost. Also, the accuracy of calculations can be affected by the so-called inflationary inequality - the difference in the share of individual goods and services in the structure of expenditures of various social groups.

The latest value of the economy indicator "Inflation rate" was 2 333,30 . The previous value of the "Inflation Rate" indicator was 2 333,30 . Date of next publication - April 6, 2020, forecast 2,30 . This indicator belongs to the category "Prices", country - Russia

Inflation rate: dynamics of the indicator

What is the official inflation rate in Russia according to Rosstat for 2017 and 2018? On this page you will find the latest statistics, table, graph and fresh forecasts of experts.

inflation in Russia. Forecasts for 2018

The Ministry of Economic Development expects that in April-May the annual inflation will be in the range of 2.1-2.2%. "In June, annual price growth could fall below 2.0%, given last year's relatively high base," the ministry said in mid-March in its traditional Economic Picture survey.

The Ministry of Economic Development still believes that, provided there are no negative weather shocks, inflation will remain below the target value of 4% throughout the year.

The Central Bank in its statement on the results of the Board of Directors on March 23 also noted that "the slowdown in annual inflation may continue in the first half of the year, which is partly due to the effect of last year's high base on food inflation." "The gradual return of inflation to the target level will begin in the second half of this year, which will be facilitated by a further recovery in domestic demand," the report said.

According to the forecast of the Bank of Russia, inflation will be 3-4% in 2018 and will be close to 4% in 2019. "Under these conditions, the Bank of Russia will continue to reduce the key rate and complete the transition to a neutral monetary policy in 2018," the Central Bank said in a statement.

The consensus forecast of Interfax based on the results of a poll of analysts at the end of March for inflation for 2018 is 3.7%.

Inflation in Russia by years. Table

In this table you will find the latest official statistics on inflation in Russia - by months and by years, starting from 1991. Official inflation in Russia at the end of 2017 amounted to 2.52%. This is the lowest level in the history of modern Russia.

Inflation expectations in Russia in 2018

In February 2018, inflation expectations of the population for the next 12 months fell to a minimum level, according to the Bulletin of the Bank of Russia "Inflation Expectations and Consumer Sentiment of the Population".

The value of inflation expected by the population "updated the lowest level on record (8.4 percent compared to 8.9 percent in January)," the document says. Observations have been conducted since January 2016.

Respondents' expectations of inflation by the end of this year and in a three-year perspective are also optimistic. Four percent of respondents believe that inflation will be well below four percent by the end of this year. This is the highest figure in the history of observations. The share of those who believe that inflation will significantly exceed four percent in three years is at the lowest level in the entire history of observations - 40 percent. However, in general, the level of inflation expectations is still high, and the proportion of those who expect inflation near four percent is still less than a third of all respondents, the authors of the report point out.

14 percent of respondents are sure that prices for food, non-food products and services will not change or decrease. This is the highest rate since January 2016.

At the same time, the majority of Russians are sure that the prices for gasoline and meat have grown the most over the past month. According to respondents, the prices of printed materials, services of cultural institutions and tourism services have risen the least.

Decrease in inflation in 2018. What are the risks for the Russian economy?

The net profit of Russian banks during 2018-2021 will stagnate against the backdrop of a gradual decrease in the amount of deductions to reserves, the contraction of banks' margins caused by low inflation in the country will also have a constraining effect, according to the annual forecast of the Analytical Credit Rating Agency (ACRA) for the banking system .

Annual inflation in Russia in January, according to Rosstat, slowed down to 2.2% from 2.5% in December. According to the forecast of the Central Bank, annual inflation in the Russian Federation will remain below 4% in 2018 and will be close to this level in 2019. The regulator also acknowledged that in the first half of 2018, the annual growth in consumer prices in Russia may continue to slow down.

According to ACRA analysts, Russian banks will earn a net profit of 0.9 trillion rubles in 2018, 1 trillion rubles each in 2019 and 2020, and 1.2 trillion rubles in 2021.