Reference Base Period

AAA

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.

INVESTOPEDIA EXPLAINS '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. Constant Dollar

    An adjusted value of currency used to compare dollar values from ...
  2. Consumer Price Index - CPI

    A measure that examines the weighted average of prices of a basket ...
  3. Economic Indicator

    A piece of economic data, usually of macroeconomic scale, that ...
  4. Producer Price Index - PPI

    A family of indexes that measures the average change in selling ...
  5. Inflation

    The rate at which the general level of prices for goods and services ...
  6. Insurance Inflation Protection

    Insurance inflation protection is designed to allow policyholders ...
Related Articles
  1. Investing Basics

    Economic Indicators That Do-It-Yourself Investors Should Know

    Understanding these investing tools will put the market in your hands.
  2. Economics

    Why The Consumer Price Index Is Controversial

    Find out why economists are torn about how to calculate inflation.
  3. Options & Futures

    The Consumer Price Index: A Friend To Investors

    As a measure of inflation, this index can help you make key financial decisions.
  4. Options & Futures

    Explaining The World Through Macroeconomic Analysis

    From unemployment and inflation to government policy, learn what macroeconomics measures and how it affects everyone.
  5. Economics

    The Importance Of Inflation And GDP

    Learn the underlying theories behind these concepts and what they can mean for your portfolio.
  6. Economics

    Can the consumer price index (CPI) for individual areas be used to compare living cost among areas?

    Understand why the Consumer Price Index, or CPI, cannot appropriately be used for comparing the cost of living across different areas of the country.
  7. Economics

    Will the consumer price index (CPI) be updated or revised in the future?

    Learn about the consumer price index (CPI) and understand how its purpose and calculation make it necessary to continually update and revise it.
  8. Economics

    Does the consumer price index (CPI) correlate with the change in price of goods and services?

    See why the consumer price index is a questionable proxy for inflation, and why it is unlikely to represent experiences with price changes accurately.
  9. Economics

    Is the consumer price index (CPI) a cost of living index?

    Explore the consumer price index (CPI) and understand why it is not an actual cost of living index although it is often identified as one.
  10. Economics

    How does the invisible hand phenomenon affect investment markets?

    Read about how the invisible hand of the market coordinates investment markets and provides social benefit and why its effects are distorted along the way.

You May Also Like

Hot Definitions
  1. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  2. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  3. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  4. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  5. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  6. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
Trading Center