A difference between rates
If a rate rises from 4% to 5%, the absolute difference is one percentage point. The relative increase is 25%, because 5 ÷ 4 − 1 equals 0.25. Both calculations can be correct, but their labels describe very different quantities. Calling that move a 1% increase hides the distinction.
This matters for unemployment, interest rates, saving rates and other measures already expressed in percent. The default absolute comparison for the U-3 unemployment rate is in percentage points. It is not a relative change in the number of unemployed people. The labor-force denominator can also change.
Basis points are another unit for the same difference
One percentage point equals 100 basis points. A yield moving from 4.00% to 4.25% rises by 0.25 percentage point, or 25 basis points. A 10-year Treasury yield of 4.5% and a 2-year yield of 4.0% imply a spread of 0.5 percentage point, or 50 basis points, when the dates and quote conventions match.
The yield spread page subtracts same-date nominal Treasury constant-maturity yields. It preserves gaps when either leg is missing. The spread is descriptive. Its level or sign does not guarantee a future economic outcome.
Percentage growth compares levels
For an index or dollar level, percentage change equals 100 × (ending value ÷ starting value − 1). An index moving from 200 to 210 increases 5%. The absolute increase is ten index points, which must not be called ten percentage points of inflation.
If an inflation rate falls from 5% to 3%, the rate declines by two percentage points while the price level still rises over the stated interval. Keep the measured object clear: a price index level, an inflation rate and a change in that rate are three different calculations. Ratio growth also needs a meaningful positive denominator; missing values cannot be treated as zero.