Gdp Deflator

The GDP deflator is a measure of inflation that measures the overall change in prices in a country’s economy. It is calculated by dividing GDP price index by GDP deflator. The GDP deflator is a key indicator of inflation and is used by central banks to control inflation.

The GDP deflator is important because it is a measure of overall price change, which is an important factor in determining economic growth. If inflation is high, it can erode the purchasing power of wages and benefits, and can make it difficult for businesses to plan for the future. If inflation is too low, it can slow economic growth and can create deflation, which is a condition where prices are falling.