When they give monthly inflation figures, is that how much it’s gone up that month, or averaging across the year?

Question

Each month you’ll get an article headline like “Inflation at 3% in July” or whatever. Does that mean prices went up 3% in July, or does it mean across this year the average after July is 3%? I know prices are going up lots lately but if it’s 3% each month that’s 36% a year? Please explain to my silly little brain.

In: Economics

Answer 1

Lots of confusing answers here because, as it turns out, the US reports inflation differently from most European countries (not sure about the rest of the world).

In the US, 3% in July means that if that rate continued for another 11 months, prices would have risen 3%. In Europe, it almost certainly means that prices in July 2024 were 3% higher than in July 2023.