Shortcuts - Spotlight on the CPI
What is it?
We've all heard of the CPI but what is it exactly? Imagine a basket of goods and services containing items typically bought by Australian households. As the prices of the of the items in the basket change from one quarter to the next, so too will the total price of the basket. The CPI (Consumer Price Index) is simply a measure of the changes in the cost of this fixed basket over time. It is sometimes referred to as a measure of inflation, a measure of changes in purchasing power, or a measure of changes in the cost of living.
What is the CPI used for?
As an important Economic Indicator, the CPI is used widely, including:
- measures price changes relating to the spending pattern of all metropolitan households in the 6 State capital cities, Darwin and Canberra
- covers expenditure on food, alcohol and tobacco, clothing and footwear, housing, household furnishings, supplies and services, health, transportation, communication, recreation, education, as well as on some other miscellaneous items
- is produced quarterly
- the list of items in the basket of goods and services is reviewed about every five years
Where is it?
- for the allocation of funding to Local Government
- by the Reserve Bank of Australia in determining monetary policy
- to index Social Security and superannuation payments
- in a range of business contracts for price adjustment
Want more detail?
See the Guide to the Consumer Price Index: 14th Series (Cat. no. 6440.0)
This shortcut was adapted from the Local Government and the ABS Newsletter, Issue 5, March 2004.
- For full text see Consumer Price Index, Australia (Cat. no. 6401.0). Available from eLEP and AusStats and in Core List LEP libraries
- Also a free snapshot on the ABS web site in the CPI Main Features
- To directly access current and historical CPI data call the CPI Infoline on 1902 981 074 (75c a minute)