The consumer price index (CPI), or vísitala neysluverðs, is the measure of price levels in Iceland. Statistics Iceland (Hagstofa Íslands) calculates it every month from the prices of goods and services that households buy, such as food, housing, fuel, clothing and leisure. The change in the index is the InflationInflationA general rise in prices over time, which means each króna buys less than before. figure you hear about in the news.
How is it calculated?
Statistics Iceland tracks the prices of a large number of goods and services. Each item is weighted by how big a share of their spending households devote to it, and the weights are updated every year from Statistics Iceland's household expenditure survey.
The index was set at 100 in May 1988. In October 2026 it stood at 700.4 points, which means prices have risen more than sevenfold since then. Over the previous twelve months it had risen 5.9%.
Housing is a large part of the index. The cost for people living in their own homes is estimated as if they paid rent to themselves, and since June 2024 the estimate has been based on the rent for comparable housing. Statistics Iceland also publishes an index excluding housing.
What is it used for?
- Measuring inflation. The Central Bank's 2.5% inflation target is based on the consumer price index.
- Indexation. The principal of index-linkedIndexationWhen the principal of a loan or deposit follows the consumer price index. Indexation protects savings from inflation but makes debts rise with prices. loans and deposits follows the index, under Act No. 38/2001 on Interest and Price Indexation.
- Comparing prices over time. The index lets you work out what an amount of krónur from the past is worth today, and whether purchasing powerPurchasing powerHow many goods and services money can buy. Purchasing power falls when prices rise faster than wages or savings. has risen or fallen.
Good to know
The index describes an average household. The inflation you feel may be different, depending on whether you rent or own, drive a car or have children. Nor does the index measure the prices of assets such as shares or crypto, only what households buy for consumption.
Everything in Myntkaup Learn is written and regularly reviewed by the Myntkaup editorial team. It is for education and is not investment advice. Editorial policy. Updated 2 November 2026.