The Consumer Price Index for All Urban Consumers (CPI-U) in the Chicago-Gary-Kenosha area was up 0.6 percent in August, the U.S. Bureau of Labor Statistics reported today. Regional Commissioner Charlene Peiffer noted that energy prices rose 7.8 percent while food prices were down 0.3 percent. The all items less food and energy category was unchanged over the month. Among the indexes within the all items less food and energy category, prices were higher for apparel and lower for new and used motor vehicles and for household furnishings and operations. (Data in this report are not seasonally adjusted. Accordingly, month-to-month changes may reflect the impact of seasonal influences.)

Over the last 12 months, the Chicago area all items CPI-U increased 1.5 percent. The energy index declined 1.2 percent since last August, primarily due to falling prices for utility (piped) gas service and electricity. The all items less food and energy index was 1.6 percent higher over the year.

Food

Food prices were down 0.3 percent in August after remaining unchanged in July. Of the two components within the food index, food at home prices (groceries) were 0.6 percent lower and food away from home prices (restaurant, cafeteria, and vending purchases) increased 0.2 percent over the month. Within the food at home group, prices were higher for eggs and apples. Prices were lower for snacks, canned fruits and vegetables, and bread.

From August 2011 to August 2012, the food index increased 2.2 percent. In the previous 12-month period ended August 2011, food prices in the Chicago area were up 3.8 percent.

Energy

The energy index rose 7.8 percent in August following a 2.9-percent decline in July. Within the energy category, prices for gasoline and utility (piped) gas service increased 11.5 percent and 5.8 percent, respectively. Electricity prices were unchanged over the month.

Over the year, costs for utility (piped) gas service decreased 12.6 percent and prices for electricity were down 9.1 percent. The index for gasoline was up 5.4 percent. Overall energy prices declined 1.2 percent for the 12 months ended in August 2012.

All items less food and energy

The index for all items less food and energy was unchanged in August. Among the index’s components, prices were higher for apparel (2.4 percent) in contrast to lower prices for new and used motor vehicles and for household furnishings and operations (-1.4 percent).

Over the year, the index for all items less food and energy increased 1.6 percent. Shelter was the largest contributor, rising 1.7 percent from August 2011 to August 2012. Medical care costs (3.9 percent), recreation costs (3.2 percent), and prices for other goods and services (5.0 percent) also rose since last August.

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The September 2012 Consumer Price Index for Chicago is scheduled to be released on October 16, 2012, at 7:30 a.m. (CT).

Technical Note

The Consumer Price Index (CPI) is a measure of the average change in prices over time in a fixed market basket of goods and services. The Bureau of Labor Statistics publishes CPIs for two population groups: (1) a CPI for All Urban Consumers (CPI-U) which covers approximately 88 percent of the total population and (2) a CPI for Urban Wage Earners and Clerical Workers (CPI-W) which covers 29 percent of the total population. The CPI-U includes, in addition to wage earners and clerical workers, 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 CPI is based on prices of food, clothing, shelter, and fuels, transportation fares, charges for doctors' and dentists' services, drugs, and the other goods and services that people buy for day-to-day living. Each month, prices are collected 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.

The index measures price changes from a designated reference date (1982-84) that equals 100.0. An increase of 16.5 percent, for example, is shown as 116.5. 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 see the CPI home page on the Internet at www.bls.gov/cpi and the BLS Handbook of Methods, Chapter 17, The Consumer Price Index, available on the Internet at www.bls.gov/opub/hom/homch17_a.htm.

In calculating the index, price changes for the various items in each location are averaged together with weights that represent their importance in the spending of the appropriate population group. Local data are then combined to obtain a U.S. city average. Because the sample size of a local area is smaller, the local area index is subject to substantially more sampling and other measurement error than the national index. In addition, local indexes are not adjusted for seasonal influences. As a result, local area indexes show greater volatility than the national index, although their long-term trends are quite similar. NOTE: Area indexes do not measure differences in the level of prices between cities; they only measure the average change in prices for each area since the base period.

The Chicago-Gary-Kenosha, Ill.-Ind.-Wis. consolidated area covered in this release is comprised of Cook, DeKalb, DuPage, Grundy, Kane, Kankakee, Kendall, Lake, McHenry, and Will Counties in Illinois; Lake and Porter Counties in Indiana; and Kenosha County in Wisconsin.

Information in this release will be made available to sensory impaired individuals upon request. Voice phone: 202-691-5200; TDD message referral phone number:  1-800-877-8339.