Reference Base Period

DEFINITION of 'Reference Base Period'

A year in which the Consumer Price Index is equal to 100, a reference base period that serves as a benchmark for future periods, allowing economists to judge levels of inflation. Currently, the reference base period is set between 1982 and 1984.

BREAKING DOWN 'Reference Base Period'

When a year is assigned a price level from the CPI, the reference base period can be used to convey how much inflation occurred. For example, if the current year has a CPI level of 115, this would mean that prices today have increased by 15% (115-100) from the base period of 1982-1985.

RELATED TERMS
  1. Holding Period

    The real or expected period of time during which an investment ...
  2. Reference Rate

    An interest rate benchmark upon which a floating-rate security ...
  3. Consumer Price Index - CPI

    A measure that examines the weighted average of prices of a basket ...
  4. Closing Range

    The band of prices that a security trades at in a specified period, ...
  5. Bogey

    A buzzword that refers to a benchmark used to evaluate a fund's ...
  6. Reference Obligation

    The specific underlying debt upon which a credit derivative is ...
Related Articles
  1. Professionals

    Asking For A Reference: Who, How, When And Where?

    It can be awkward and a bit of a pain, but having the right references is an important step to landing that new job or being accepted to the school of your choice.
  2. Options & Futures

    Why Inflation Feels Higher Than the Fed's Target Rate

    Follow the monthly readings on core PCE inflation in the Personal Income and Outlays reports to understand the Federal Reserve's inflation assessments.
  3. Economics

    Macroeconomics: Inflation

    By Stephen Simpson Inflation is a key concept in macroeconomics, and a major concern for government policymakers, companies, workers and investors. Inflation refers to a broad increase in prices ...
  4. Economics

    Should You Worry About the U.S Inflation rate?

    Understand how inflation is measured, how U.S. inflation compares to other countries, and if investors should be concerned with rising inflation.
  5. Forex

    How CPI Affects the Dollar Against Other Currencies

    The Consumer Price Index is a broad measure of inflation, and inflation can have a dramatic impact on a currency's value against rival currencies.
  6. Economics

    Inflation And Economic Recovery

    Inflation impacts the costs of every facet of the economy. Discover how it can help or hinder the economic recovery.
  7. Retirement

    Economic Indicators: Consumer Price Index (CPI)

    By Ryan Barnes Release Date: Monthly, approximately mid-month Release Time: 8:30am Eastern Standard Time Coverage: Previous ...
  8. Economics

    The Importance Of Inflation And GDP

    Learn the underlying theories behind these concepts and what they can mean for your portfolio.
  9. Technical Indicators

    Moving Average

    Learn about this basic technical indicator and how you can use it to chart the value of a security's price over a set period.
  10. Bonds & Fixed Income

    The Money Market: A Look Back

    Learn how past inflationary periods can predict future real rates of return for cash investments.
RELATED FAQS
  1. What's the lowest year-over-year inflation rate in the history of the U.S.?

    Learn about years with the lowest year-over-inflation in U.S. history. Read about how inflation is calculated using the consumer ... Read Answer >>
  2. What's the highest year-over-year inflation rate in the history of the U.S.?

    Learn about periods with the highest inflation in U.S. history and the mandated role of the U.S. Federal Reserve in controlling ... Read Answer >>
  3. How does inflation affect fixed-income investments?

    Learn about the ways inflation can harm fixed-income investments. Find out how to monitor the impact of inflation using common ... Read Answer >>
  4. How does the Bureau of Labor Statistics determine the Consumer Price Index (CPI)?

    Changes in the average price level of more than 200 goods and services across the U.S. economy are used to determine the ... Read Answer >>
  5. What are some limitations of the consumer price index (CPI)?

    Explore some of the basic limitations of the widely used economic indicator, the consumer price index, or CPI, and examine ... Read Answer >>
  6. How is cash flow affected by Average Collection Period?

    See how reducing a company's average collection period can help cash flow, and learn why collections practices are so important ... Read Answer >>
Hot Definitions
  1. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  2. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  3. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  4. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  5. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  6. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
Trading Center