Consumer Price Index - CPIEconomy
Consumer Price Index Summary – 2022 M12 Results – TheFinanceHeadline
Consumer Price Index Summary
Transmission of material in this release is embargoed until 8:30 a.m. (ET) Thursday, January 12, 2023 USDL-23-0017 Technical information: (202) 691-7000 * email@example.com * www.bls.gov/cpi Media contact: (202) 691-5902 * PressOffice@bls.gov CONSUMER PRICE INDEX - DECEMBER 2022 The Consumer Price Index for All Urban Consumers (CPI-U) declined 0.1 percent in December on a seasonally adjusted basis, after increasing 0.1 percent in November, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 6.5 percent before seasonal adjustment. The index for gasoline was by far the largest contributor to the monthly all items decrease, more than offsetting increases in shelter indexes. The food index increased 0.3 percent over the month with the food at home index rising 0.2 percent. The energy index decreased 4.5 percent over the month as the gasoline index declined; other major energy component indexes increased over the month. The index for all items less food and energy rose 0.3 percent in December, after rising 0.2 percent in November. Indexes which increased in December include the shelter, household furnishings and operations, motor vehicle insurance, recreation, and apparel indexes. The indexes for used cars and trucks, and airline fares were among those that decreased over the month. The all items index increased 6.5 percent for the 12 months ending December; this was the smallest 12-month increase since the period ending October 2021. The all items less food and energy index rose 5.7 percent over the last 12 months. The energy index increased 7.3 percent for the 12 months ending December, and the food index increased 10.4 percent over the last year; all of these increases were smaller than for the 12-month period ending November.
|Seasonally adjusted changes from preceding month||Un-|
Food at home
Food away from home(1)
Gasoline (all types)
Utility (piped) gas service
All items less food and energy
Commodities less food and energy commodities
Used cars and trucks
Medical care commodities(1)
Services less energy services
Medical care services
Food The food index increased 0.3 percent in December following a 0.5-percent increase in November. The food at home index rose 0.2 percent in December. Three of the six major grocery store food group indexes increased over the month. The index for meats, poultry, fish, and eggs increased 1.0 percent in December, as the index for eggs rose 11.1 percent. The index for other food at home rose 0.4 percent over the month, while the index for nonalcoholic beverages increased 0.1 percent in December. In contrast, the fruits and vegetables index fell 0.6 percent over the month with the fresh fruit index declining 1.9 percent. The index for dairy and related products decreased 0.3 percent in December, and the index for cereals and bakery products was unchanged. The food away from home index rose 0.4 percent in December, after increasing 0.5 percent in November. The index for limited service meals increased 0.5 percent over the month and the index for full service meals increased 0.1 percent. The food at home index rose 11.8 percent over the last 12 months. The index for cereals and bakery products rose 16.1 percent over the year. The remaining major grocery store food groups posted increases ranging from 7.7 percent (meats, poultry, fish, and eggs) to 15.3 percent (dairy and related products). The index for food away from home rose 8.3 percent over the last year. The index for full service meals rose 8.2 percent over the last 12 months, and the index for limited service meals rose 6.6 percent over the same period. Energy The energy index fell 4.5 percent in December after falling 1.6 percent in November. The gasoline index declined 9.4 percent over the month, following a 2.0-percent decrease in November. (Before seasonal adjustment, gasoline prices fell 12.5 percent in December.) The index for natural gas rose over the month, increasing 3.0 percent after decreasing 3.5 percent in November. The electricity index increased 1.0 percent in December. The energy index rose 7.3 percent over the past 12 months. The gasoline index decreased 1.5 percent over the span. The fuel oil index rose 41.5 percent over the last 12 months, the index for electricity rose 14.3 percent, and the index for natural gas increased 19.3 percent over the same period. All items less food and energy The index for all items less food and energy rose 0.3 percent in December, following a 0.2-percent increase in November. The shelter index continued to increase, rising 0.8 percent over the month. The rent index rose 0.8 percent over the month, and the owners' equivalent rent index also rose 0.8 percent. The index for lodging away from home increased 1.5 percent in December, after falling 0.7 percent in November. The shelter index was the dominant factor in the monthly increase in the index for all items less food and energy, while other components were a mix of increases and declines. Among the other indexes that rose in December was the index for household furnishings and operations, which increased 0.3 percent over the month, while the index for motor vehicle insurance rose 0.6 percent, and the index for recreation increased 0.2 percent. The apparel index rose 0.5 percent in December, and the education index increased 0.3 percent. The medical care index rose 0.1 percent in December, after declining in the previous 2 months. The index for hospital services increased 1.7 percent over the month. The physicians' services index and the prescription drugs index both rose 0.1 percent in December. Indexes which declined over the month include the index for used cars and trucks, which fell 2.5 percent in December, the sixth consecutive decline in that index. The index for airline fares fell 3.1 percent over the month, following a 3.0-percent decrease in November. The new vehicles index declined 0.1 percent in December, as did the personal care index. The index for all items less food and energy rose 5.7 percent over the past 12 months. The shelter index increased 7.5 percent over the last year, accounting for more than half of the total increase in all items less food and energy. Other indexes with notable increases over the last year include household furnishings and operations (+6.7 percent), medical care (+4.0 percent), new vehicles (+5.9 percent), and recreation (+5.1 percent). Not seasonally adjusted CPI measures The Consumer Price Index for All Urban Consumers (CPI-U) increased 6.5 percent over the last 12 months to an index level of 296.797 (1982-84=100). For the month, the index decreased 0.3 percent prior to seasonal adjustment. The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 6.3 percent over the last 12 months to an index level of 291.051 (1982-84=100). For the month, the index decreased 0.5 percent prior to seasonal adjustment. The Chained Consumer Price Index for All Urban Consumers (C-CPI-U) increased 6.4 percent over the last 12 months. For the month, the index decreased 0.2 percent on a not seasonally adjusted basis. Please note that the indexes for the past 10 to 12 months are subject to revision. _______________ The Consumer Price Index for January 2023 is scheduled to be released on Tuesday, February 14, 2023, at 8:30 a.m. (ET). -------------------------------------------------------------------------------------------- January 2023 Consumer Price Index Weight Update Starting with January 2023 data, BLS plans to update weights annually for the Consumer Price Index based on a single calendar year of data, using consumer expenditure data from 2021. This reflects a change from prior practice of updating weights biennially using two years of expenditure data. --------------------------------------------------------------------------------------------- Technical Note Brief Explanation of the CPI The Consumer Price Index (CPI) measures the change in prices paid by consumers for goods and services. The CPI reflects spending patterns for each of two population groups: all urban consumers and urban wage earners and clerical workers. The all urban consumer group represents about 93 percent of the total U.S. population. It is based on the expenditures of almost all residents of urban or metropolitan areas, including professionals, the self -employed, the poor, the unemployed, and retired people, as well as urban wage earners and clerical workers. Not included in the CPI are the spending patterns of people living in rural nonmetropolitan areas, farming families, people in the Armed Forces, and those in institutions, such as prisons and mental hospitals. Consumer inflation for all urban consumers is measured by two indexes, namely, the Consumer Price Index for All Urban Consumers (CPI-U) and the Chained Consumer Price Index for All Urban Consumers (C-CPI-U). The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) is based on the expenditures of households included in the CPI-U definition that meet two requirements: more than one-half of the household's income must come from clerical or wage occupations, and at least one of the household's earners must have been employed for at least 37 weeks during the previous 12 months. The CPI-W population represents about 29 percent of the total U.S. population and is a subset of the CPI-U population. The CPIs are based on prices of food, clothing, shelter, fuels, transportation, doctors' and dentists' services, drugs, and other goods and services that people buy for day-to-day living. Prices are collected each month in 75 urban areas across the country from about 6,000 housing units and approximately 22,000 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 75 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 visit, telephone call, or web collection by the Bureau's trained representatives. In calculating the index, price changes for the various items in each location are aggregated using 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 23 selected 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. The CPI-U and CPI-W are considered final when released, but the C-CPI-U is issued in preliminary form and subject to three subsequent quarterly revisions. The index measures price change from a designed reference date. For most of 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 7 percent from the reference base, for example, is shown as 107.000. Alternatively, that relationship can also be expressed as the price of a base period market basket of goods and services rising from $100 to $107. Sampling Error in the CPI 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 CPI. 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 percent of these estimates will 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-U, 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 www.bls.gov/cpi/tables/variance-estimates/home.htm. Calculating Index Changes Movements of the indexes from 1 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 following table shows an example of using index values to calculate percent changes: Item A Item B Item C Year I 112.500 225.000 110.000 Year II 121.500 243.000 128.000 Change in index points 9.000 18.000 18.000 Percent change 9.0/112.500 x 100 = 8.0 18.0/225.000 x 100 = 8.0 18.0/110.000 x 100 = 16.4 Use of Seasonally Adjusted and Unadjusted Data The Consumer Price Index (CPI) produces both unadjusted and seasonally adjusted data. Seasonally adjusted data are computed using seasonal factors derived by the X-13ARIMA-SEATS seasonal adjustment method. These factors are updated each February, and the new factors are used to revise the previous 5 years of seasonally adjusted data. The factors are available at www.bls.gov/cpi/tables/seasonal-adjustment/seasonal-factors-2022.xlsx. For more information on data revision scheduling, please see the Factsheet on Seasonal Adjustment at www.bls.gov/cpi/seasonal-adjustment/questions-and-answers.htm and the Timeline of Seasonal Adjustment Methodological Changes at www.bls.gov/cpi/seasonal-adjustment/timeline-seasonal-adjustment-methodology-changes.htm. For analyzing short-term 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 weather events, production cycles, model changeovers, holidays, and sales. This allows data users to focus on changes that are not typical for the time of year. The unadjusted data are of primary interest to consumers concerned about the prices they actually pay. Unadjusted data are also 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. BLS advises against the use of seasonally adjusted data in escalation agreements because seasonally adjusted series are revised annually. Intervention Analysis The Bureau of Labor Statistics uses intervention analysis seasonal adjustment (IASA) for some CPI series. Sometimes extreme values or sharp movements can distort the underlying seasonal pattern of price change. Intervention analysis seasonal adjustment is a process by which the distortions caused by such unusual events are estimated and removed from the data prior to calculation of seasonal factors. The resulting seasonal factors, which more accurately represent the seasonal pattern, are then applied to the unadjusted data. For example, this procedure was used for the motor fuel series to offset the effects of the 2009 return to normal pricing after the worldwide economic downturn in 2008. Retaining this outlier data during seasonal factor calculation would distort the computation of the seasonal portion of the time series data for motor fuel, so it was estimated and removed from the data prior to seasonal adjustment. Following that, seasonal factors were calculated based on this "prior adjusted" data. These seasonal factors represent a clearer picture of the seasonal pattern in the data. The last step is for motor fuel seasonal factors to be applied to the unadjusted data. For the seasonal factors introduced for January 2022, BLS adjusted 72 series using intervention analysis seasonal adjustment, including selected food and beverage items, motor fuels, electricity, and vehicles. Revision of Seasonally Adjusted Indexes Seasonally adjusted data, including the U.S. city average all items index levels, are subject to revision for up to 5 years after their original release. Every year, economists in the CPI calculate new seasonal factors for seasonally adjusted series and apply them to the last 5 years of data. Seasonally adjusted indexes beyond the last 5 years of data are considered to be final and not subject to revision. For January 2022, revised seasonal factors and seasonally adjusted indexes for 2017 to 2021 were calculated and published. For series which are directly adjusted using the Census X-13ARIMA-SEATS seasonal adjustment software, the seasonal factors for 2021 will be applied to data for 2022 to produce the seasonally adjusted 2022 indexes. Series which are indirectly seasonally adjusted by summing seasonally adjusted component series have seasonal factors which are derived and are therefore not available in advance. Determining Seasonal Status Each year the seasonal status of every series is reevaluated based upon certain statistical criteria. Using these criteria, BLS economists determine whether a series should change its status from "not seasonally adjusted" to "seasonally adjusted", or vice versa. If any of the 81 components of the U.S. city average all items index 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. For 2022, 22 of the 81 components of the U.S. city average all items index are seasonally adjusted. Contact Information For additional information about the CPI visit www.bls.gov/cpi or contact the CPI Information and Analysis Section at 202-691-7000 or firstname.lastname@example.org. For additional information on seasonal adjustment in the CPI visit www.bls.gov/cpi/seasonal-adjustment/home.htm or contact the CPI seasonal adjustment section at 202-691-6968 or email@example.com. If you are deaf, hard of hearing, or have a speech disability, please dial 7-1-1 to access telecommunications relay services.