Consumer Price Index Summary

 Transmission of material in this release is embargoed until                                        
 8:30 a.m. (EDT) Tuesday, August 19, 2014  USDL-14-1547

 Technical information: (202) 691-7000  Reed.Steve@bls.gov  www.bls.gov/cpi
 Media Contact:         (202) 691-5902  PressOffice@bls.gov 

 CONSUMER PRICE INDEX – JULY 2014

 The Consumer Price Index for All Urban Consumers (CPI-U) increased 
 0.1 percent in July on a seasonally adjusted basis, the U.S. Bureau 
 of Labor Statistics reported today. Over the last 12 months, the all 
 items index increased 2.0 percent before seasonal adjustment.

 The all items index posted its smallest seasonally adjusted increase 
 since February; the indexes for shelter and food rose, but were 
 partially offset by declines in the energy index and the index for 
 airline fares. The food index rose 0.4 percent in July, with the food 
 at home index also rising 0.4 percent after being unchanged in June. 
 The decrease in the energy index was its first since March and featured 
 declines in the indexes of all the major energy components.

 The index for all items less food and energy increased 0.1 percent in 
 July, the same increase as in June. Along with the shelter index, the 
 indexes for medical care, new vehicles, personal care, and apparel all 
 increased in July. Along with the index for airline fares, the indexes 
 for recreation, for used cars and trucks, for household furnishings and 
 operations, and for tobacco all declined in July.

 The all items index increased 2.0 percent over the last 12 months, a 
 slight decline from the 2.1 percent figure for the 12 months ending June. 
 The index for all items less food and energy rose 1.9 percent over the 
 last 12 months, the same figure as for the 12 months ending June. The 
 energy index has increased 2.6 percent, and the food index has risen 2.5 
 percent over the span.



 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.
                              Jan.  Feb.  Mar.  Apr.  May   June  July   ended 
                              2014  2014  2014  2014  2014  2014  2014   July  
                                                                         2014  
                                                                               
                                                                               
 All items..................    .1    .1    .2    .3    .4    .3    .1      2.0
  Food......................    .1    .4    .4    .4    .5    .1    .4      2.5
   Food at home.............    .1    .5    .5    .4    .7    .0    .4      2.7
   Food away from home (1)..    .1    .3    .3    .3    .2    .2    .3      2.4
  Energy....................    .6   -.5   -.1    .3    .9   1.6   -.3      2.6
   Energy commodities.......   -.5  -1.3  -2.0   1.9    .6   3.0   -.3      1.2
    Gasoline (all types)....  -1.0  -1.7  -1.7   2.3    .7   3.3   -.3       .8
    Fuel oil (1)............   3.7   4.1  -2.9  -3.0  -1.4  -1.7   -.7      2.2
   Energy services..........   2.2    .7   2.6  -1.9   1.4   -.4   -.4      4.7
    Electricity.............   1.8   -.2   1.1  -2.6   2.3    .2   -.3      4.0
    Utility (piped) gas                                                        
       service..............   3.6   3.6   7.5    .3  -1.7  -2.6   -.4      6.9
  All items less food and                                                      
     energy.................    .1    .1    .2    .2    .3    .1    .1      1.9
   Commodities less food and                                                   
      energy commodities....   -.1   -.1    .0    .1    .1    .1    .0      -.3
    New vehicles............   -.3    .1    .0    .3    .2   -.3    .3       .2
    Used cars and trucks....   -.5   -.1    .4    .5   -.1   -.4   -.3       .2
    Apparel.................   -.3   -.3    .3    .0    .3    .5    .2       .3
    Medical care commodities    .5    .6   -.3    .3    .5    .7    .3      3.0
   Services less energy                                                        
      services..............    .2    .2    .3    .3    .3    .1    .1      2.6
    Shelter.................    .3    .2    .3    .2    .3    .2    .3      2.9
    Transportation services     .1    .3    .2    .7   1.0    .1   -.7      1.8
    Medical care services...    .2    .2    .3    .3    .3    .0    .1      2.5

   1 Not seasonally adjusted.




 Consumer Price Index Data for July 2014

 Food

 The food index rose 0.4 percent in July, its fifth increase at least that 
 large in the last 6 months. The food at home index also rose 0.4 percent 
 in July, with no declines among the six major grocery store food groups. 
 The largest increase was posted by the other food at home index, which 
 rose 0.7 percent, its largest increase since August 2011. The index for 
 nonalcoholic beverages rose 0.5 percent in July, and the cereals and 
 bakery products index increased 0.4 percent. The index for meats, poultry, 
 fish, and eggs rose 0.3 percent, as did the dairy and related products 
 index. The only major grocery store food group index not to rise in July 
 was fruits and vegetables, which was unchanged. The index for fresh fruits 
 rose 1.0 percent, but the fresh vegetables index fell 1.1 percent. The food 
 at home index has risen 2.7 percent over the last 12 months. The index for 
 meats, poultry, fish, and eggs has increased 7.6 percent over the span and 
 the index for dairy and related products has risen 4.3 percent. The index 
 for food away from home rose 0.3 percent in July after increasing 0.2 percent 
 in each of the 2 previous months. It has risen 2.4 percent over the last 
 12 months.     


 Energy

 The energy index, which had risen in each of the last 3 months, fell 0.3 
 percent in July as all of its components posted modest declines. The 
 gasoline index fell after a series of increases, declining 0.3 percent. 
 (Before seasonal adjustment, gasoline prices decreased 1.5 percent.) The 
 electricity index also fell 0.3 percent in July; it has now risen three 
 times and fallen three times over the last 6 months. The fuel oil index 
 fell 0.7 percent in July; this was its smallest decline in the last 5 months. 
 The index for natural gas fell 0.4 percent, its third decline in a row. 
 Despite the July declines, all the major energy component indexes have 
 increased over the past 12 months. The index for natural gas has risen 
 6.9 percent and the electricity index has advanced 4.0 percent. The fuel 
 oil index has risen 2.2 percent, and the gasoline index has increased 0.8 
 percent.  


 All items less food and energy

 The index for all items less food and energy increased 0.1 percent in July, 
 the same increase as in June. The shelter index, which rose 0.2 percent in 
 June, advanced 0.3 percent in July. The indexes for rent and owners’ 
 equivalent rent both increased 0.3 percent, while the lodging away from 
 home index rose 0.2 percent. The medical care index rose 0.2 percent in 
 July. The index for medical care commodities rose 0.3 percent, with the 
 index for prescription drugs increasing 0.5 percent. The index for medical 
 care services increased 0.1 percent, with the hospital services index rising 
 0.4 percent but the index for physicians’ services declining 0.2 percent. 
 The index for new vehicles, which fell 0.3 percent in June, rose 0.3 percent 
 in July. The index for personal care also rose 0.3 percent, and the apparel 
 index advanced 0.2 percent. In contrast to these increases, the index for 
 airline fares fell sharply in July, declining 5.9 percent after rising 10.9 
 percent over the previous 5 months. The index for used cars and trucks fell 
 0.3 percent, its third consecutive decline. The tobacco index, which rose 
 1.0 percent in June, also declined 0.3 percent in July, while the indexes 
 for recreation and for household furnishings and operations both declined 
 0.1 percent.

 The index for all items less food and energy has risen 1.9 percent over the 
 last 12 months. The shelter index has risen 2.9 percent over this span, and 
 the medical care index has increased 2.6 percent. Indexes that rose more 
 slowly over the last 12 months include the apparel index (0.3 percent) and 
 the indexes for new vehicles and for used cars and trucks (both 0.2 percent). 
 The indexes for airline fares and for household furnishings and operations 
 both declined over the past year.   


 Not seasonally adjusted CPI measures

 The Consumer Price Index for All Urban Consumers (CPI-U) increased 2.0 percent 
 over the last 12 months to an index level of 238.250 (1982-84=100). For the month, 
 the index was unchanged prior to seasonal adjustment.  

 The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) 
 increased 1.9 percent over the last 12 months to an index level of 234.525 
 (1982-84=100). For the month, the index fell 0.1 percent prior to seasonal adjustment.  

 The Chained Consumer Price Index for All Urban Consumers (C-CPI-U) increased 1.9 
 percent over the last 12 months. For the month, the index fell 0.1 percent on a not 
 seasonally adjusted basis. Please note that the indexes for the post-2012 period are 
 subject to revision.


	
 The Consumer Price Index for August 2014 is scheduled to be released on Wednesday, 
 September 17, 2014, 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 28 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 covers approximately 
 89 percent of the total population and includes, 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 0.04 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 0.08 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 0.12 and 0.28 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 2013”.  
 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/cpivar2013.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







 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-13ARIMA-SEATS Seasonal Adjustment Method.  Seasonally adjusted indexes 
 and seasonal factors are computed annually.  Each year, the last five years of 
 seasonally adjusted data are revised. Data from January 2009 through December 
 2013 were replaced in January 2014.  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 64 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 five years, but the seasonally adjusted indexes before that 
 period will not be changed. Note: 35 of the 82 components are not seasonally 
 adjusted for 2014.

 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. In 
 2014, for the 2009-2013 revisions, the Bureau of Labor Statistics began using 
 X-13ARIMA-SEATS to perform the seasonal adjustment of CPI series, including 
 Intervention Analysis Seasonal Adjustment for certain series.

 For the seasonal factors introduced in January 2014, 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 the response in 
 crude oil markets to the worldwide economic downturn in 2008.  

 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 Chris Graci at (202) 691-5826, or by e-mail at 
 graci.christopher@bls.gov, or contact Carlyle Jackson at (202) 691-6984, or by 
 e-mail at jackson.carlyle@bls.gov . If you have general questions about the CPI, 
 please call our information staff at (202) 691-7000.   



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Last Modified Date: August 19, 2014