CPI / indexation / inflation

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Can anyone explain, in simple terms, the difference between Consumer Price Index and indexation? I'm honestly confused but I reckon they all refer to an ability to forecast the purchasing power of a euro in the future. but which is most realistic/ a better measure of future inflation (for someone with a mortgage)? I've googled it but can't see exactly what factors each use to make a calculation to predict the spending power of the euro in the future.
Thanks in advance
 
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Aren't they the same thing -- discounting the value of your euro by a certain percentage each year to take account of inflation? Indexation is just a generic term, unless I'm completely mistaken and you have some particular index in mind. The Consumer Price Index is based on a basket of goods that represent the purchases of the "average" consumer. The problem is that by definition an average can't represent your particular situation if your costs and their weightings are different from the average. Some of the biggest costs don't apply to everyone and are not included, perhaps the prime example being capital repayments on a mortgage. The CPI does include mortgage interest, but the HICP (the harmonised index calculated across the European Union) doesn't. There is also a separate Monetary Union index for the eurozone. See the background notes to the CSO's CPI page for more info and links to even more info.
 
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