Transmission of material in this release is embargoed until
8:30 a.m. (EDT) Friday, September 14, 2012 USDL-12-1834
Technical information: (202) 691-7000 Reed.Steve@bls.gov www.bls.gov/cpi
Media Contact: (202) 691-5902 PressOffice@bls.gov
Consumer Price Index - August 2012
The Consumer Price Index for All Urban Consumers (CPI-U) increased
0.6 percent in August on a seasonally adjusted basis, the U.S. Bureau
of Labor Statistics reported today. Over the last 12 months, the all
items index increased 1.7 percent before seasonal adjustment.
The seasonally adjusted increase in the all items index was the
largest since June 2009. About 80 percent of the increase was
accounted for by the gasoline index, which rose 9.0 percent and was
the major factor in the energy index rising sharply in August after
declining in each of the four previous months.
The food index increased 0.2 percent in August, with major grocery
store food group indexes mixed. The index for all items less food and
energy rose 0.1 percent for the second month in a row. The indexes
for shelter, medical care, personal care, new vehicles, and
recreation all rose in August. These increases more than offset
declines in the indexes for used cars and trucks, apparel, household
furnishings and operations, and airline fares.
The 12-month change in the index for all items was 1.7 percent in
August, an increase from the July figure of 1.4 percent. The index
for all items less food and energy rose 1.9 percent for the 12 months
ending August, a slight decline from the 2.1 percent figure in July
and its smallest increase since July 2011.
Table A. Percent changes in CPI for All Urban Consumers (CPI-U): U.S. city
average
Seasonally adjusted changes from
preceding month
Un-
adjusted
12-mos.
Feb. Mar. Apr. May June July Aug. ended
2012 2012 2012 2012 2012 2012 2012 Aug.
2012
All items.................. .4 .3 .0 -.3 .0 .0 .6 1.7
Food...................... .0 .2 .2 .0 .2 .1 .2 2.0
Food at home............. .0 .1 .2 -.1 .1 .0 .1 1.5
Food away from home (1).. .1 .2 .3 .2 .2 .2 .3 2.8
Energy.................... 3.2 .9 -1.7 -4.3 -1.4 -.3 5.6 -.6
Energy commodities....... 5.7 1.7 -2.6 -6.4 -2.3 .2 8.6 1.5
Gasoline (all types).... 6.0 1.7 -2.6 -6.8 -2.0 .3 9.0 1.8
Fuel oil (1)............ 2.8 2.7 -1.1 -2.8 -7.9 -.5 4.6 -.8
Energy services.......... -.8 -.4 -.2 -.7 .0 -1.1 .8 -3.7
Electricity............. .0 -.8 .2 .3 -.5 -1.3 .2 -1.2
Utility (piped) gas
service.............. -3.4 .9 -1.8 -4.1 1.7 -.2 2.8 -11.2
All items less food and
energy................. .1 .2 .2 .2 .2 .1 .1 1.9
Commodities less food and
energy commodities.... .1 .2 .2 .2 .2 .0 -.2 .7
New vehicles............ .6 .2 .4 .2 .2 -.1 .2 1.0
Used cars and trucks.... -.2 1.3 1.5 1.0 .0 -.5 -.9 -.6
Apparel................. -.9 .5 .4 .4 .5 .2 -.5 1.7
Medical care commodities
(1).................. .8 .4 .0 .0 .1 .5 .3 3.6
Services less energy
services.............. .1 .2 .3 .2 .2 .1 .1 2.4
Shelter................. .2 .2 .2 .2 .1 .1 .2 2.1
Transportation services -.2 .3 .5 .3 -.2 -.2 .0 1.4
Medical care services... .0 .3 .4 .5 .7 .3 .2 4.2
1 Not seasonally adjusted.
Consumer Price Index Data for August 2012
Food
The food index rose 0.2 percent in August after a 0.1 percent
increase in July and has risen 2.0 percent over the past 12 months.
The food at home index, which was unchanged in July, increased 0.1
percent in August. The food at home index has been stable in recent
months, increasing a total of 0.1 percent since April. Three of the
six major grocery store food group indexes increased in August. The
fruits and vegetables index increased 0.5 percent in August after
declining in July, with the index for fresh fruits rising 1.9 percent
but the fresh vegetables index declining 1.3 percent. The index for
meats, poultry, fish, and eggs rose 0.4 percent in August, its third
consecutive increase. The index for dairy and related products rose
0.1 percent, ending a streak of six consecutive declines. In contrast
to these increases the index for nonalcoholic beverages fell 0.2
percent in August after a 0.5 percent July decrease, and the index
for other food at home fell 0.1 percent. The index for cereals and
bakery products was unchanged in August. The index for food away from
home rose 0.3 percent in August and has risen 2.8 percent over the
last 12 months.
Energy
The energy index, which had declined in each of the four previous
months, rose 5.6 percent in August. This was its largest increase
since June 2009. The gasoline index accounted for most of the
increase, rising 9.0 percent. (Before seasonal adjustment, gasoline
prices increased 7.2 percent in August.) However, the other major
energy indexes, which had all declined in July, increased as well.
The fuel oil index increased 4.6 percent, the index for natural gas
rose 2.8 percent, and the electricity index advanced 0.2 percent.
Over the last 12 months, the energy index has declined 0.6 percent.
The gasoline index has risen 1.8 percent over that span, but the
other major indexes have declined, with the index for natural gas
down 11.2 percent, the electricity index down 1.2 percent, and the
fuel oil index down 0.8 percent.
All items less food and energy
The index for all items less food and energy increased 0.1 percent in
August, the same increase as in July. The index for shelter, which
rose 0.1 percent in July, rose 0.2 percent in August. The rent index
increased 0.2 percent and the index for owners' equivalent rent rose
0.3 percent, but the index for lodging away from home fell 0.6
percent. The medical care index rose 0.2 percent in August after
rising 0.4 percent in July. The indexes for personal care, new
vehicles, and recreation also increased in August. In contrast to
these increases, several indexes declined in August. The index for
used cars and trucks fell 0.9 percent, the apparel index fell 0.5
percent, and the index for household furnishings and operations fell
0.3 percent. The index for airline fares fell 1.3 percent in August,
its third decline in a row, and the tobacco index also declined.
The index for all items less food and energy has risen 1.9 percent
over the last 12 months; this figure has been trending down slightly
since its recent peak of 2.3 percent in March, April, and May.
Indexes for most major components have increased over the period,
though the indexes for used cars and trucks and airline fares show
declines. The medical care index rose 4.1 percent and the shelter
index increased 2.1 percent.
Not seasonally adjusted CPI measures
The Consumer Price Index for All Urban Consumers (CPI-U) increased
1.7 percent over the last 12 months to an index level of 230.379
(1982-84=100). For the month, the index increased 0.6 percent prior
to seasonal adjustment.
The Consumer Price Index for Urban Wage Earners and Clerical Workers
(CPI-W) increased 1.7 percent over the last 12 months to an index
level of 227.056 (1982-84=100). For the month, the index increased
0.7 percent prior to seasonal adjustment.
The Chained Consumer Price Index for All Urban Consumers (C-CPI-U)
increased 1.5 percent over the last 12 months. For the month, the
index increased 0.4 percent on a not seasonally adjusted basis.
Please note that the indexes for the post-2010 period are subject to
revision.
The Consumer Price Index for September 2012 is scheduled to be
released on Tuesday, October 16, 2012, at 8:30 a.m. (EDT).
Facilities for Sensory Impaired
Information from this release will be made available to sensory
impaired individuals upon request. Voice phone: 202-691-5200,
Federal Relay Services: 1-800-877-8339.
Brief Explanation of the CPI
The Consumer Price Index (CPI) is a measure of the average change in
prices over time of goods and services purchased by households. The
Bureau of Labor Statistics publishes CPIs for two population groups:
(1) the CPI for Urban Wage Earners and Clerical Workers (CPI-W),
which covers households of wage earners and clerical workers that
comprise approximately 29 percent of the total population and (2) the
CPI for All Urban Consumers (CPI-U) and the Chained CPI for All Urban
Consumers (C-CPI-U), which cover approximately 88 percent of the
total population and include in addition to wage earners and clerical
worker households, groups such as professional, managerial, and
technical workers, the self-employed, short-term workers, the
unemployed, and retirees and others not in the labor force.
The CPIs are based on prices of food, clothing, shelter, and fuels,
transportation fares, charges for doctors' and dentists' services,
drugs, and other goods and services that people buy for day-to-day
living. Prices are collected each month in 87 urban areas across the
country from about 4,000 housing units and approximately 26,000
retail establishments-department stores, supermarkets, hospitals,
filling stations, and other types of stores and service
establishments. All taxes directly associated with the purchase and
use of items are included in the index. Prices of fuels and a few
other items are obtained every month in all 87 locations. Prices of
most other commodities and services are collected every month in the
three largest geographic areas and every other month in other areas.
Prices of most goods and services are obtained by personal visits or
telephone calls of the Bureau's trained representatives.
In calculating the index, price changes for the various items in each
location are averaged together with weights, which represent their
importance in the spending of the appropriate population group.
Local data are then combined to obtain a U.S. city average. For the
CPI-U and CPI-W separate indexes are also published by size of city,
by region of the country, for cross-classifications of regions and
population-size classes, and for 27 local areas. Area indexes do not
measure differences in the level of prices among cities; they only
measure the average change in prices for each area since the base
period. For the C-CPI-U data are issued only at the national level.
It is important to note that the CPI-U and CPI-W are considered final
when released, but the C-CPI-U is issued in preliminary form and
subject to two annual revisions.
The index measures price change from a designed reference date. For
the CPI-U and the CPI-W the reference base is 1982-84 equals 100.
The reference base for the C-CPI-U is December 1999 equals 100. An
increase of 16.5 percent from the reference base, for example, is
shown as 116.500. This change can also be expressed in dollars as
follows: the price of a base period market basket of goods and
services in the CPI has risen from $10 in 1982-84 to $11.65.
For further details visit the CPI home page on the Internet at
http://www.bls.gov/cpi/ or contact our CPI Information and Analysis
Section on (202) 691-7000.
Note on Sampling Error in the Consumer Price Index
The CPI is a statistical estimate that is subject to sampling error
because it is based upon a sample of retail prices and not the
complete universe of all prices. BLS calculates and publishes
estimates of the 1-month, 2-month, 6-month and 12-month percent
change standard errors annually, for the CPI-U. These standard error
estimates can be used to construct confidence intervals for
hypothesis testing. For example, the estimated standard error of the
1 month percent change is 0.03 percent for the U.S. All Items
Consumer Price Index. This means that if we repeatedly sample from
the universe of all retail prices using the same methodology, and
estimate a percentage change for each sample, then 95% of these
estimates would be within 0.06 percent of the 1 month percentage
change based on all retail prices. For example, for a 1-month change
of 0.2 percent in the All Items CPI for All Urban Consumers, we are
95 percent confident that the actual percent change based on all
retail prices would fall between 0.14 and 0.26 percent. For the
latest data, including information on how to use the estimates of
standard error, see "Variance Estimates for Price Changes in the
Consumer Price Index, January-December 2011". These data are
available on the CPI home page (http://www.bls.gov/cpi), or by using
the following link http://www.bls.gov/cpi/cpivar2011.pdf
Calculating Index Changes
Movements of the indexes from one month to another are usually
expressed as percent changes rather than changes in index points,
because index point changes are affected by the level of the index in
relation to its base period while percent changes are not. The
example below illustrates the computation of index point and percent
changes.
Percent changes for 3-month and 6-month periods are expressed as
annual rates and are computed according to the standard formula for
compound growth rates. These data indicate what the percent change
would be if the current rate were maintained for a 12-month period.
Index Point Change
CPI
202.416
Less previous index
201.800
Equals index point change
.616
Percent Change
Index point difference
.616
Divided by the previous index
201.800
Equals
0.003
Results multiplied by one hundred
0.003x100
Equals percent change
0.3
Regions Defined
The states in the four regions are listed below.
The Northeast--Connecticut, Maine, Massachusetts, New Hampshire, New
York, New Jersey, Pennsylvania, Rhode Island, and Vermont.
The Midwest--Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota,
Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin.
The South--Alabama, Arkansas, Delaware, Florida, Georgia, Kentucky,
Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South
Carolina, Tennessee, Texas, Virginia, West Virginia, and the District
of Columbia.
The West--Alaska, Arizona, California, Colorado, Hawaii, Idaho,
Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming.
A Note on Seasonally Adjusted and Unadjusted Data
Because price data are used for different purposes by different
groups, the Bureau of Labor Statistics publishes seasonally adjusted
as well as unadjusted changes each month.
For analyzing general price trends in the economy, seasonally
adjusted changes are usually preferred since they eliminate the
effect of changes that normally occur at the same time and in about
the same magnitude every year--such as price movements resulting from
changing climatic conditions, production cycles, model changeovers,
holidays, and sales.
The unadjusted data are of primary interest to consumers concerned
about the prices they actually pay. Unadjusted data also are used
extensively for escalation purposes. Many collective bargaining
contract agreements and pension plans, for example, tie compensation
changes to the Consumer Price Index before adjustment for seasonal
variation.
Seasonal factors used in computing the seasonally adjusted indexes
are derived by the X-12-ARIMA Seasonal Adjustment Method. Seasonally
adjusted indexes and seasonal factors are computed annually. Each
year, the last 5 years of seasonally adjusted data are revised. Data
from January 2007 through December 2011 were replaced in January
2012. Exceptions to the usual revision schedule were: the updated
seasonal data at the end of 1977 replaced data from 1967 through
1977; and, in January 2002, dependently seasonally adjusted series
were revised for January 1987-December 2001 as a result of a change
in the aggregation weights for dependently adjusted series. For
further information, please see "Aggregation of Dependently Adjusted
Seasonally Adjusted Series," in the October 2001 issue of the CPI
Detailed Report.
Effective with the publication of data from January 2006 through
December 2010 in January 2011, the Video and audio series and the
Information technology, hardware and services series were changed
from independently adjusted to dependently adjusted. This resulted
in an increase in the number of seasonal components used in deriving
seasonal movement of the All items and 54 other lower level
aggregations, from 73 for the publication of January 1998 through
December 2005 data to 82 for the publication of seasonally adjusted
data for January 2006 and later. Each year the seasonal status of
every series is reevaluated based upon certain statistical criteria.
If any of the 82 components change their seasonal adjustment status
from seasonally adjusted to not seasonally adjusted, not seasonally
adjusted data will be used in the aggregation of the dependent series
for the last 5 years, but the seasonally adjusted indexes before that
period will not be changed. Note: 38 of the 82 components are not
seasonally adjusted for 2012.
Seasonally adjusted data, including the all items index levels, are
subject to revision for up to five years after their original
release. For this reason, BLS advises against the use of these data
in escalation agreements.
Effective with the calculation of the seasonal factors for 1990, the
Bureau of Labor Statistics has used an enhanced seasonal adjustment
procedure called Intervention Analysis Seasonal Adjustment for some
CPI series. Intervention Analysis Seasonal Adjustment allows for
better estimates of seasonally adjusted data. Extreme values and/or
sharp movements which might distort the seasonal pattern are
estimated and removed from the data prior to calculation of seasonal
factors. Beginning with the calculation of seasonal factors for
1996, X-12-ARIMA software was used for Intervention Analysis Seasonal
Adjustment.
For the seasonal factors introduced in January 2012, BLS adjusted 31
series using Intervention Analysis Seasonal Adjustment, including
selected food and beverage items, motor fuels, electricity and
vehicles. For example, this procedure was used for the Motor fuel
series to offset the effects of events such as damage to oil
refineries from Hurricane Katrina.
For a complete list of Intervention Analysis Seasonal Adjustment
series and explanations, please refer to the article "Intervention
Analysis Seasonal Adjustment", located on our website at
http://www.bls.gov/cpi/cpisapage.htm.
For additional information on seasonal adjustment in the CPI, please
write to the Bureau of Labor Statistics, Division of Consumer Prices
and Price Indexes, Washington, DC 20212 or contact David Levin at
(202) 691-6968, or by e-mail at Levin.David@bls.gov. If you have
general questions about the CPI, please call our information staff at
(202) 691-7000.
