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Policymakers, businesses, and investors monitor inflation, the increase in the cost of goods and services, closely. Inflation is a sign of economic growth, but excessive inflation can harm the economy. Inflation indexes gather price data from various sources to provide a snapshot of the overall cost of goods and services in the economy. Monitoring how prices are changing can provide insights into economic growth, influencing financial markets and investments. The main inflation indexes discussed are the CPI (Consumer Price Index), PCE (Personal Consumption Expenditures Price Index), and PPI (Producer Price Index), each with unique compilation methods and purposes.
