CPI (Consumer Price Index)

The Consumer Price Index (CPI) measures how much the average price of everyday goods and services—like groceries, gas, and rent—changes over time. It's basically inflation (the rate prices go up) measured by the government each month. You'll hear about CPI constantly in financial news because it's the main signal of whether your money is losing buying power. When CPI rises quickly, the Federal Reserve often raises interest rates to cool things down, which can affect stock prices and your savings account. For example, if CPI jumped 5% in a year, that means things cost roughly 5% more than they did before. Investors watch CPI reports like hawks because they hint at what the economy and stock market might do next.