Annex A: How to use the GDP deflator series: Practical
examples
NOTE – The GDP deflator data used to illustrate the worked examples shown throughout
this annex were published by HM Treasury on 27 March 2013.
The following is an extract from a deflator series and provides examples of how the series
can be used.
GDP deflator at market
prices
GDP (£ million)
Financial
Year
GDP
deflator
2011-12
=100
percentage
change on
previous
year
Money
GDP Cash
Money
GDP Real
Terms
2011-12
prices
2006-07 89.254 2.69 1,350,438 1,513,028
2007-08 91.478 2.49 1,432,887 1,566,373
2008-09 93.975 2.73 1,422,290 1,513,477
2009-10 95.389 1.50 1,415,654 1,484,085
2010-11 97.978 2.71 1,480,569 1,511,124
2011-12 100.000 2.06 1,524,550 1,524,550
2012-13 101.30
0
1.3 1,546,000 1,526,160
2013-14 103.63
0
2.3 1,595,000 1,539,131
data in italics have been added-in for the purposes of this example
Calculating Inflation Between Different years
In the above example there is a 2.71% increase in prices between 2009-10 and 2010-11
i.e.
..
.
100 2.71%
Q. What was the cumulative inflation between 2006-07 and 2011-12?
A. 12.04% increase between 2006-07 and 2011-12.
i.e.
.
.
100 12.04%
Inflating Figures
Q. How much would £7.40 million in 2009-10 prices be worth in 2013-14 prices?
A. Use the GDP deflator series which shows that in 2013-14 prices are higher than in 2009-
10 by a ratio of 1.09 (103.630 ÷ 95.389).
