The inflation rate for the United States is the rate of change of the annual average of the monthly cost of a bundle of goods and services a representative household bought in a base year as measured by the Consumer Price Index (CPI). In principle, this bundle is the same every year, although periodically the bundle is adjusted.

These numbers will not be the same as those announce each month (with great anticipation) because those are the percent change in the index between the latest monthly observation and its value 12 months earlier. The annual inflation in the US for 2021 was 4.7% while the inflation from December 2020 to December 2021 was 7.0%.

The latest inflation rate for the United Kingdom announced this month was 4.8% and this was the percent change of their Consumer Price Index (CPI) from December 2020 to December 2021. The annual rate of inflation for 2021 of the CPI was 2.52%.

The inflation rates for the United Kingdom presented here are for the percentage change in the average value of the Retail Price Index (RPI) for the year, a series similar to the CPI. The annual rate for 2021 was 4.06%, while the percent change for the RPI from December 2020 to December 2021 was 7.55%. Why the CPI is not used for the UK.

The inflation rate for a particular year is computed by taking the price index of that year minus the price index of the previous year, divided by the price index of the previous year, all multiplied by 100. The result page also gives the annualized inflation rate for the entire period from the initial to the ending year.

Samuel H. Williamson "Annual Inflation Rates in the United States, 1775 - 2023, and the United Kingdom, 1265 - 2023," MeasuringWorth, 2024.

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