The trend over time.
What CPI Inflation measures.
The year-over-year percentage change in the Consumer Price Index for All Urban Consumers (CPI-U), from the BLS. It is calculated here from the seasonally adjusted monthly index and covers a broad basket of goods and services, including food and energy.
It is the number most often quoted as 'inflation'. Because it is a 12-month change, a big move in the same month a year ago can push it up or down even when prices this month barely changed (a base effect). The Fed's 2% target is defined on a different index, PCE.
Why it matters.
This number directly affects your purchasing power and how much your paycheck actually buys at the grocery store and gas pump. It also influences whether your savings lose value and guides Federal Reserve decisions on interest rates that impact your mortgage and borrowing costs.