Inflation is a rate.
Prices are a level.

A two-year illustration

Start a hypothetical price index at 100. If it rises by 8% in the first year, it reaches 108. If inflation then slows to 2% in the second year, the index reaches 110.16. Inflation has fallen, but the price level is higher in both years.

Disinflation and deflation

Disinflation describes a slowing rate of price increases. Deflation describes a decline in a broad price level. A lower positive inflation reading is therefore different from a negative one.

The comparison window matters

A monthly rate compares adjacent months. A year-over-year rate compares the current month with the same month a year earlier. A movement in the annual rate can reflect both the newest month and the month leaving the comparison. Always identify the window before comparing numbers.

An index is not your receipt

A broad price index combines categories using weights. An individual household’s spending pattern can differ from those weights. PCE and CPI also differ in their construction; a comparison should identify the measure rather than treating every inflation figure as the same statistic.