Verðlagsgreini

Verðlagsgreini is an Icelandic term that translates to "price index" or "inflation index." It is a statistical measure used to track the average change over time in the prices of a basket of goods and services typically purchased by households. This basket is composed of items that reflect common consumer spending patterns and is regularly updated to maintain its relevance.

The primary purpose of a verðlagsgreini is to measure inflation, which is the general increase in prices and the fall in the purchasing value of money. By comparing the cost of the representative basket of goods and services in one period to its cost in another, economists and policymakers can determine the rate of inflation. This information is crucial for understanding economic conditions, making informed policy decisions, and adjusting wages, pensions, and other financial agreements to account for changes in the cost of living.

Different types of price indices exist, but the most commonly referenced verðlagsgreini in Iceland is the Consumer Price Index (Vísitölur neysluverðs). This index is compiled by Statistics Iceland (Hagstofa Íslands) and is a key indicator for economic analysis and forecasting. It is used by the central bank, government agencies, businesses, and the public to gauge the stability of prices and the erosion of purchasing power.