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The Interactive Big Mac Index, a Currency-Comparison Tool

Robyn Lee Post a comment

The Big Mac Index isn't meant to be a serious currency-comparison tool, but if you're interested in comparing Big Mac prices around the world and how much those prices undervalue or overvalue a country's currency against another, check out The Economist's nifty interactive Big Mac Index, which was updated last week. More

Latest Big Mac Index Suggests the Euro is Overvalued

Robyn Lee Post a comment

The Economist reports that "currencies continue to be cheap in the developing world but overvalued in Europe" according to the Big Mac Index, an informal way of measuring countries' currency values by comparing the prices of their Big Macs against their actual exchange rates. (The Economist admits, "The Big Mac numbers should be taken with a generous pinch of salt. They are not a precise predictor of currency movements.") More

Charts: Big Mac Inflation vs Official Inflation Rates

Robyn Lee 1 comment

If you don't trust governments to truthfully report their inflation rates, what's one burger-related way you can cross-check official inflation rates? Check out the prices of their countries' Big Macs over the years. The Economist introduced the Big Mac Index in 1986 as a simple way to calculate the values of currencies around the world against the US dollar using the theory of purchasing power parity"the notion that a dollar should buy the same amount in all countries." Last week The Economist published this updated chart of Big Mac inflation minus official inflation rates. (Of course, Big Mac prices can't tell you everything about inflation. Because..it's a burger.) [via Karen L.] More

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