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Sunday, 31 July 2011

Word of the Day


A continuous rise in the average price level. Measured by the Retail Price Index (RPI) and the Consumer Price Index (CPI). The RPI contains mortgage interest payments thus it is always larger than the CPI. Usually inflation is measured by the CPI. In the UK, the current rate of inflation is 4.5% (June) while the Bank of England's target rate of inflation is 2%.