Question 1

What is inflation?

Accepted Answer

Inflation is the rise in the general price level of goods and services in an economy over a certain period. It means you can buy less with the same money than before. Inflation is usually expressed as a percentage per year.

Question 2

How is inflation measured?

Accepted Answer

Inflation is measured using the Consumer Price Index (CPI). This is a weighted average of the prices of a representative "basket" of products and services that households buy. In the Netherlands, CBS measures this index, in other countries the national statistical office or OECD does this.

Question 3

What is derived CPI (Netherlands only)?

Accepted Answer

The derived CPI is an adjusted version of the regular CPI where the effect of changes in indirect taxes (such as VAT or excise duties) has been filtered out. This provides a clearer picture of actual price development, independent of tax effects. CBS calculates this specifically for the Netherlands.

Question 4

How do I use the inflation calculator?

Accepted Answer

Our calculators are easy to use. For the purchasing power calculator, you enter an amount and select a start and end year. The calculator then automatically calculates what you could have bought with that amount in both years. For the salary calculator, you can enter your wage increases to see if your purchasing power was maintained.

Question 5

Why does inflation differ by country?

Accepted Answer

Inflation differs by country due to various factors: economic growth, employment, wage costs, energy prices, exchange rates, taxes, and monetary policy of the central bank. The composition of the consumer basket can also differ between countries.

Question 6

What is deflation?

Accepted Answer

Deflation is the opposite of inflation: a decline in the general price level. This seems favorable but can be problematic for the economy. When people expect prices to fall further, they postpone purchases, leading to lower demand and economic stagnation.

Question 7

What is the ECB's inflation target?

Accepted Answer

The European Central Bank (ECB) aims for an inflation rate of around 2% per year for the eurozone. This is considered a healthy level that promotes economic growth without eroding purchasing power too quickly. The ECB uses interest rate policy to steer towards this target.

Question 8

What is hyperinflation?

Accepted Answer

Hyperinflation is extremely high and usually accelerating inflation, often exceeding 50% per month. Historical examples include Germany in the 1920s and more recently Zimbabwe and Venezuela. Hyperinflation destroys an economy and makes normal economic activity nearly impossible.

Question 9

What is the difference between CPI and PCE?

Accepted Answer

CPI (Consumer Price Index) measures what consumers pay for goods and services. PCE (Personal Consumption Expenditures) is broader and includes all consumer spending, including costs paid on behalf of consumers (like healthcare). The US Federal Reserve prefers PCE as an inflation indicator.

Question 10

What is core inflation?

Accepted Answer

Core inflation is inflation excluding volatile components like food and energy. These products have highly fluctuating prices that can obscure the underlying inflation trend. Central banks often look at core inflation to assess the structural price trend.

Question 11

How often is the CPI calculated?

Accepted Answer

Most statistical offices calculate the CPI monthly. The annual inflation figure is usually calculated by comparing the current month with the same month a year earlier. Some countries also publish quarterly or annual figures.

Question 12

What is a base year?

Accepted Answer

A base year is the reference year that is set to 100 in the CPI. All other years are expressed relative to this base year. For example, if 2015 is the base year (2015=100) and the CPI in 2023 is 125, prices have risen 25% compared to 2015.

Question 13

Can I trust official inflation figures?

Accepted Answer

Official inflation figures are compiled according to international standards and are generally reliable. However, your personal experience may differ because everyone has a unique spending pattern. If you spend a lot on products that rise faster than average (like energy), you may experience higher inflation.

Question 14

What are the main causes of inflation?

Accepted Answer

Inflation can have several causes: 1) Demand inflation (more demand than supply), 2) Cost inflation (higher production costs), 3) Monetary inflation (increase in money supply), and 4) Imported inflation (more expensive imported goods, often due to exchange rates or international price increases).

Question 15

How can I protect myself against inflation?

Accepted Answer

Ways to protect against inflation: 1) Ensure salary indexation, 2) Invest in assets that retain value (stocks, real estate), 3) Choose savings accounts with competitive interest, 4) Spend consciously and compare prices, 5) Consider inflation-linked bonds. Diversification is key.

Question 16

What is inflation in Netherlands in 2024?

Accepted Answer

View the current inflation figures for Netherlands on our page. The figures are updated monthly with the latest data.

Question 17

Where can I find historical inflation figures for Netherlands?

Accepted Answer

On the Netherlands country page you will find all historical inflation figures per year and per month, including charts and comparisons.

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