The Consumer Price Index: How to make it a better gauge of inflation

The Consumer Price Index (CPI) is the nation’s most prominent inflation gauge, used to adjust Social Security benefits and tax brackets as well as rents, wages, and contract prices throughout the economy. Although it has been improved over the years, it is imperfect and often criticized for failing to accurately reflect changing prices in a rapidly evolving economy. To review measurement issues and provide the Bureau of Labor Statistics with guidance for continued improvement and modernization of the CPI, the National Academies’ Committee on National Statistics formed an expert panel, which recently issued its report, “Modernizing the Consumer Price Index for the 21st Century.”

On May 25, the Hutchins Center on Fiscal & Monetary Policy hosted a virtual event to discuss that report, particularly the chapters on housing costs and measuring inflation for different income, race, and age groups. Event participants included four members of the panel that created the report–Raven Molloy of the Federal Reserve Board, Laura Rosner-Warburton of MacroPolicy Perspectives, Louise Sheiner of the Hutchins Center at Brookings, and Dan Sichel of Wellesley College. After each presentation, speakers took questions from the audience.

Registration, and our live event, ran through Zoom webinar. Join the conversation on Twitter using the hashtag #CPIReport.