INDEC launched an interactive tool to calculate your own inflation: what it is about

INDEC launched an interactive tool to calculate your own inflation: what it is about

This interactive tool finds rreflect how the evolution of prices affects individual consumption, given that many people feel that the official inflation figures “are calculated in offices far from everyday reality,” as indicated by the entity.

“With the CPI calculator, it will be possible to obtain a more precise estimate of the variations in the prices of a personalized consumption basket, compared to the average basket of all households used to calculate the national CPI,” they explained.

How the individual inflation calculation works

By publishing the results of the Consumer Price Index (CPI), INDEC recognizes that some people feel that “the reported price increases do not reflect my consumption”. This occurs because the CPI measures the average price variations in a basket representative of all households, which naturally may not coincide with the consumption patterns of a specific household.

To address this perception, the agency has developed a tool that allows each person to calculate how much the prices of the goods and services they consume have increased, based on data collected by INDEC.

The methodology is simple: users enter the expenses incurred in each category of the consumer basket during the last month. This allows them to compare the evolution of their prices with the official figures published by the Consumer Price Directorate, thus obtaining a vision that is more in line with their reality.

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The calculator involves completing the fields with the amount allocated to each item

From the INDEC they explained that the impact of a price increase varies depending on the consumption habits of each home, since it depends on the quantity consumed in relation to total expenditure.

Household consumption baskets They differ due to various factors, one of the main ones being the income level. For example, low-income households spend a greater proportion of their budget on food, while high-income households tend to spend more on services.

Factors that influence the variation of CPI data

The homes of Lower incomes allocate a significantly larger portion of their total spending on food for consumption at home, in contrast to high-income households, which tend to spend a higher proportion on restaurants and meals outside the home. Furthermore, the Geographic distribution also influences differences in consumption.

Lower-income households allocate a limited proportion of your budget to private transportation, such as purchasing or renting vehicles, fuel and insurance. Likewise, their spending on recreation, leisure and communication is relatively lower, with the exception of cell phone services.

When analyzing the consumption baskets by age groups, marked differences are observed. For example, a single-person household made up of a 25-year-old student allocates greater resources to education, recreation and leisure, communication, and outings outside the home. In contrast, a household made up of a 65-year-old couple prioritizes spending on health (medicines and social work), food, and housing-related costs.

Consequently, The CPI represents an average of the price variations of these and many other baskets, that seek to reflect the consumption of all households.

Source: Ambito

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