Base Year


DEFINITION of 'Base Year'

The first of a series of years in an economic or financial index. A base year is normally set to an arbitrary level of 100. Any year can be chosen as a base year, but typically recent years are chosen. New, more up-to-date base years are periodically introduced to keep data current in a particular index.


A base year is the year used for comparison for the level of a particular economic index. The arbitrary level of 100 is selected so that percentage changes (either rising or falling) can be easily depicted. For example, to find that rate of inflation (or any other economic index) between 2005 and 2010, one would make calculations using 2005 as the base year, or the first year in the time set.

  1. Base-Year Analysis

    1. The analysis of economic trends in relation to a specific ...
  2. Base Period

    A particular time period for which data is gathered and used ...
  3. Index

    A statistical measure of change in an economy or a securities ...
  4. Economics

    A social science that studies how individuals, governments, firms ...
  5. Year Over Year - YOY

    A method of evaluating two or more measured events to compare ...
  6. Qualitative Analysis

    Securities analysis that uses subjective judgment based on nonquantifiable ...
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