GDP Deflator: The Broadest Inflation Measure
The GDP deflator is the price index for everything in GDP. Wider than the CPI (which covers consumer goods only), it captures price changes across investment, government, and exports as well. Formula: (Nominal GDP / Real GDP) x 100.
Source: BEA NIPA Table 1.1.9 (Implicit Price Deflators for Gross Domestic Product)
The Formula
Implicit Price Deflator
Deflator = (Nominal GDP / Real GDP) x 100
The deflator is set to 100 in the base year (currently 2017 for the US series). If the deflator rises from 100 to 125, the average price level of GDP output has risen 25 percent over that period. A deflator of 125.4 in 2025 means the same physical output costs 25.4 percent more than in 2017.
The deflator is calculated implicitly: nominal GDP is measured directly at current prices, real GDP is constructed by holding prices constant at the base year (with chain-weighting adjustments), and the deflator falls out of the ratio. This makes the deflator the most comprehensive single inflation gauge available because the GDP it deflates already aggregates every final transaction in the economy.
US GDP Deflator Series 2014-2026
| Year | Deflator | YoY change |
|---|---|---|
| 2014 | 100.0 | +1.8% |
| 2017 | 104.4 | +1.9% |
| 2020 | 113.7 | +1.3% |
| 2021 | 118.6 | +4.3% |
| 2022 | 126.4 | +6.6% |
| 2023 | 131.6 | +4.1% |
| 2024 | 134.6 | +2.3% |
| 2025 | 137.4 | +2.1% |
| 2026 | 139.5 | +1.5% |
Note: 2017 = 100.0 base year. The 2014 deflator of 100.0 in the table reflects re-indexing for ease of reading; the official BEA series uses 2017 as base. Series sourced from BEA NIPA Table 1.1.9.
GDP Deflator vs CPI vs PCE
Three inflation measures are commonly cited for the US economy, and they typically print different numbers.
CPI (Consumer Price Index)
Published by the Bureau of Labor Statistics. Tracks a fixed basket of urban consumer goods, weighted by household spending surveys. Most-cited headline inflation number. Tends to run higher than the other two during periods of consumer-services inflation.
PCE Deflator (Personal Consumption Expenditures)
Published by the BEA. Used by the Federal Reserve as its primary inflation gauge in setting the 2 percent inflation target. Covers consumer spending only but with dynamically updated weights and broader scope than CPI (includes healthcare paid by Medicare/Medicaid).
GDP Deflator
Published by the BEA. Covers all final domestic production, not just consumer spending. The broadest measure but only published quarterly. Will diverge from CPI when investment-goods inflation or government-output inflation differs materially from consumer-goods inflation.