What is the Consumer Price Index?
It can be useful tool when working to improve a client's financial literacy skills. As indicated in GCDF study materials, CPI measures change from a specific set of years. To begin reading CPI, first assign the value equal to 100 for the cost of market goods and services for the benchmarked period. If the next measurement gives an index of 120, this means a 20% increase in prices. Alternatively, if the next index is 80 then it indicates a 20% decrease in cost.
- The Consumer Price Index is a statistical tool that is used by the Department of Statistics to provide an indication of inflation at a specific time.
- Use: To assess changes in cost of living that may influence salary goals, budgeting, etc.
- Bermuda Household Expenditure Report is also found on the Bermuda Economic Statistics website. This information influences the weighting of the consumer price index and provides an indication of the overall living standards of Bermuda's residents.
- Use: Reality testing of salary/lifestyle goals
A US-based Resource
- Access CPI information relevant to Bermuda. How would you use this information as you work with your clients?
- Does it provide information that supports benchmarking a minimum salary to support a client's job seeking goals within the context of his/her financial obligations?
- Compare access/layout of Bermuda's economic indicators to those presented by the US Bureau of Labour Statistics. Is there room for improvement?
- If yes, what steps would you take as a practitioner to influence the information readily available in Bermuda?