Q.

1)How inflation rate calculated?

- In US , the Department of labor is calculating inflation from year to year.

A basket of goods and services in the market are take together and cost of that goods and services are compared at various period means one year. And these figures are then averages and weighed using formulas and the end result is Consumer price index ( CPI) .

For example,

Supposed the inflation of 2016 jan. is = 236

And the inflation of jan. 2017 is = 242

Then , calculate the difference;

242 - 236 = 6

Calculate the ratio of this difference to the former CPI;

6/236 = 2.54?

So the inflation from january 2016 to january 2017 is 2.54% .

In this way the rate of inflation calculated.

2) Whome inflation rate calculated;

The US Bureau of Labor Statistics ( BLS ) calculate the inflation rate in US. To calculate inflation BLS uses the Consumer price index ( CPI ) . and year over year inflation get calculated by BLS.

Now , in 2019 inflation rate in US is 2.3%.