20.05.2022

HOW TO CALCULATE PERSONAL INFLATION?

The calculator of the so-called personal inflation is available to everyone on the website of the National Statistical Institute. The calculator takes into account changes in the prices of over 800 goods and services and allows us to calculate the price of our monthly consumption of various goods and services and see how it changes over a period of our choice.

The consumer basket of goods and services, which the National Statistical Institute uses to calculate the consumer price index and use it to calculate the inflation rate for Bulgaria, consists of 846 goods and services. For each product or service - e.g. bread, milk, movie ticket, petrol - the average price for the month and the average price for the previous year are calculated. The total consumer price index is calculated as a weighted average of changes in the prices of all 846 goods observed in more than 6,400 retail outlets in the 27 cities where prices are monitored.

However, the inflation rate does not depend only on how the prices of goods and services change. Another important factor is the weight of the individual goods and services included in the consumer basket. Weights determine the share (importance, significance) of various goods and services in the consumer basket and hence the impact of changes in their prices on the overall change in prices, ie on the inflation rate.

The weights used by the National Statistical Institute to calculate price indices (inflation rate) are determined based on data from the Household Budget Survey. They refer to the average consumer and as such reflect the consumption structure of an average Bulgarian household.

However, the average consumer exists only theoretically. For this reason, officially calculated inflation may differ from your calculations of personal inflation: for example, if you do not smoke, your personal consumption will not include the cost of tobacco products included in the basket used to calculate the official inflation rate, indicated by the NSI.

Calculator for calculating personal inflation

The calculator allows you to calculate your personal inflation, ie your consumer price index by entering your personal monthly and annual expenditures to match your personal consumption pattern.

Based on the data entered, graphs and a table with official and your calculations of monthly and annual inflation will be displayed, so you will be able to see how different weights due to different consumption patterns affect the overall change in prices. A separate chart "Cost Comparison" compares your personal consumption pattern with the consumption pattern of the average household by main types of expenditure.