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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
Seasonally adjusted changes from
Jan. Feb. Mar. Apr. May June July ended
2014 2014 2014 2014 2014 2014 2014 July
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
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
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
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
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:
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
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
Less previous index 201.800
Equals index point change .616
Index point difference .616
Divided by the previous index 201.800
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
email@example.com, or contact Carlyle Jackson at (202) 691-6984, or by
e-mail at firstname.lastname@example.org . If you have general questions about the CPI,
please call our information staff at (202) 691-7000.