neysluverðlagsvísitala

The neysluverðlagsvísitala, often abbreviated as CPI (Consumer Price Index), is a key economic indicator used to measure the average change over time in the prices paid by consumers for a basket of goods and services. In Iceland, it is compiled and published by Statistics Iceland. The CPI reflects the cost of living from the perspective of households.

The basket of goods and services used to calculate the neysluverðlagsvísitala is determined by regular surveys of household expenditure. It includes a wide range of items such as food, housing, transportation, clothing, healthcare, and recreation. The prices of these items are collected monthly from various retail outlets and service providers across the country.

The neysluverðlagsvísitala is expressed as an index number, typically with a base year set to 100. Changes in the index from one period to another indicate the rate of inflation or deflation. For example, if the CPI increases from 100 in one year to 105 in the next, it signifies a 5% increase in the general price level.

This index is crucial for various economic purposes. It is widely used to adjust wages, pensions, and social benefits to maintain purchasing power. Furthermore, it serves as a benchmark for monetary policy decisions by the central bank, as controlling inflation is often a primary objective. Businesses also use the neysluverðlagsvísitala for pricing strategies and contract negotiations.