Inflation is a general rise in prices across the economy. This is distinct from a rise in the price of a particular good or service. Individual prices rise and fall all the time in a market economy, reflecting consumer choices and preferences, and changing costs.
Inflation occurs when most prices are rising by some degree across the whole economy.
The inflation rate is a measure of the change in prices over a specified period, most commonly 12 months - the annual rate of inflation. We typically hear about the annual inflation rate for a particular month. The RPI is an index of the prices of products and services that consumers buy. It is made up of the prices of hundreds of goods and services - from basic items like bread to new products, such as mobile phones. All these prices are combined together to produce an overall index of prices.