CPI is widely used as a primary measure of inflation. By tracking changes in the prices of a representative basket of goods and services, it provides insights into the overall price level in an economy.
Many wage contracts, pensions, and other financial agreements are tied to changes in the CPI. This is done to ensure that these arrangements keep pace with the rising cost of living.
Businesses use CPI data for economic planning and forecasting. It helps them anticipate changes in consumer behavior and adjust pricing strategies accordingly.
Investors analyze CPI data to make informed investment decisions. Changes in inflation can affect interest rates, bond yields, and stock market performance.
CPI data allows for comparisons of inflation rates between different countries. This is valuable for assessing relative economic performance and making investment decisions in a global context.