Harmonized Index of Consumer Prices

The Harmonised Index of Consumer Prices, or HICP, is a consumer price index calculated using a methodology harmonised across European Union member states, giving the European Central Bank a comparable measure of inflation and price stability across the euro area. The euro area HICP is a weighted average of the national indices of member states, and the European Central Bank aims to keep its year on year increase at around two percent over the medium term. The HICP is also used to judge whether a country meets the inflation criterion for adopting the euro, and the United Kingdom publishes an equivalent index that the Bank of England uses to set its own inflation target.