> When food also starts outpacing the average (historically it has paralleled wages in the USA), you really have to ask what inflation is measuring.
inflation is measuring the value of a currency. CPI is a way to infer inflation from the nominal price of consumer goods; but it is not the definition of inflation. put another way, if an apple costs twice as much as it did last year, that fact is not enough to say whether the currency inflated.
"the value of a currency" isn't a physical reality; it is only observed through price fluctuations. so, defining it this way is just kicking the can. The fact that you can measure very different values by focusing on Forex, labor costs, or various CPI baskets is exactly the concern with gaining too much comfort from any single-number summary in the face of price changes that are impacting daily life for millions.
I would consider the value of currency to be as real as the value of a software license, even though neither is a physical item per se. I guess that's somewhat philosophical.
my real point here is that nominal price increases do not necessarily imply inflation. if the price of one type of good is increasing much faster than the others, a better explanation is that the real value of those specific goods is increasing. does this matter to ordinary people buying food? not really. their main concern here is the nominal price of food compared to their nominal earnings.
inflation is measuring the value of a currency. CPI is a way to infer inflation from the nominal price of consumer goods; but it is not the definition of inflation. put another way, if an apple costs twice as much as it did last year, that fact is not enough to say whether the currency inflated.
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