What is the Breakfast Index?

The Breakfast Index was created by Hard Assets Investor (HAI), it is a price indicator that measures inflation in wholesale food prices. The breakfast index captures the food items mostly consumed as breakfast, these are cocoa, coffee, milk, wheat, butter, sugar, bacon and orange juice. The breakfast index monitors or gauges inflation in the prices of these food items. The Bloomberg breakfast index on the other hand estimates how well individuals with average wages are able to afford typical breakfast, the food items listed above. This index measures both inflation and affordability of wholesale food prices.

What does the Breakfast Index Show?

This breakfast index estimates inflation by measuring the cost of breakfast items and comparing the cost to the Consumer Price Index (CPI). The eight food items that people eats as breakfast in the United States are measured to detect inflation. The Bloomberg breakfast index estimates average wages of individuals and the cost of living in cities. How much people earn for a living is compared with their purchasing power or how affordable food items are in their cities. The Bloomberg breakfast index uses the amount of four food items in 129 cities of the world in estimating average wage and affordability of food items. Aside from the Traditional Breakfast Index and the Bloomberg breakfast index, the FAO Food Price Index is another index used in measuring inflation of prices in foods items. FAO price index measures changes in price and inflation in food items at the International level while the traditional Breakfast index measures domestic changes in prices. Although, both uses breakfast items, the breakfast index considers the prices of eight food items, while the FAO measures the indexes of five items and not their prices. The Bloomberg breakfast index on the other hand tasks a look at the amount of food items and the average wage of individuals. It also measures inflation at the international level by comparing food prices and inflation across countries.

Related Topics

• Inflation
• Core Inflation
• Cost Push Inflation
• Demand Pull Inflation
• Wage Push Inflation
• Inflation Spiral (Wage-Price Spiral)
• Agflation
• Basket of Goods and Services
• Indexing and Index Number
• Base Year
• Consumer Price Index
• Substitution Bias
• Quality / New Goods Bias
• Core Inflation Index
• Producer Price Index
• International Price Index
• Employment Cost Index
• Buying Power Index
• Breakfast Index
• Employment Cost Index
• Producer Price Index
• Capital Goods Price Index
• Farm (Agricultural) Price Index
• Harmonized Index of Consumer Prices
• Repeated Sales Method (Real Estate)
• GDP Deflator
• Deflation
• Pigou Effect
• Hyperinflation (Economics)
• Biflation
• Inflation and Redistribution of Purchasing Power
• Inflation Blurs Price Signals
• Inflation Affects Long-Term Planning
• What are the Benefits of Inflation?
• Indexing and Index Number
• Cost of Living Allowance
• Adjustable Rate Mortgage