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CPI (Consumer Price Index)

CPI is the index measuring the price level of a fixed basket of goods and services consumed by households, from which consumer inflation is computed. The Consumer Price Index is published by TurkStat on the 3rd of each month (or the first business day if it falls on a weekend).
Contents
  1. 1.Key points
  2. 2.Formula / calculation
  3. 3.Interpretation
  4. 4.Pitfalls
  5. 5.Frequently asked questions

Key points

  • The basket contains more than 400 items; 12 main spending groups such as food, transport, housing, clothing, health, education and recreation are weighted by the household budget survey.
  • CPI is the indicator against which the CBRT’s inflation target is measured; the minimum wage, rent increases and the return on CPI-linked bonds depend on it.
  • CPI represents the average consumer; felt inflation deviates when your spending pattern differs.

Formula / calculation

Index = Σ (Item price index × Item weight); monthly and annual changes are derived from this index. Weights are updated every year. Core inflation (B and C indices) excludes energy, food, alcohol-tobacco and gold to show the underlying trend.

Interpretation

CPI is the indicator against which the CBRT’s inflation target is measured; the minimum wage, rent increases and the return on CPI-linked bonds depend on it. Investors compare their returns with CPI to compute real return.

Pitfalls

CPI represents the average consumer; felt inflation deviates when your spending pattern differs. Seasonal items (clothing, food) swing the monthly rate. The gap between PPI and CPI hints at future consumer inflation.

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Frequently asked questions

CPI is the index measuring the price level of a fixed basket of goods and services consumed by households, from which consumer inflation is computed.

Index = Σ (Item price index × Item weight); monthly and annual changes are derived from this index. Weights are updated every year. Core inflation (B and C indices) excludes energy, food, alcohol-tobacco and gold to show the underlying trend.

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