SOUTH REGION CONSUMER PRICE INDEX: MAY 2009 (PDF)

The Consumer Price Index for All Urban Consumers (CPI-U) for the South¹ increased 0.3 percent in May to 207.265 (1982-84=100), the Bureau of Labor Statistics of the U.S. Department of Labor reported today.  Sheila Watkins, the Bureau’s regional commissioner, noted that the increase was predominantly due to higher prices for transportation, particularly gasoline.  Lower costs for apparel moderated the overall increase in the CPI, while the remaining six major categories had little or no change in May.  The energy index increased 3.7 percent over the month, while food costs were unchanged.  The core inflation rate, as measured by the all items less food and energy index, was also unchanged during the month.

Chart A.  1-month and 12-month percent changes ended May 2009 for the major categories of the CPI-U for the South region, not seasonally adjusted

Chart data

Over the last 12 months, prices in the South decreased 1.3 percent, as a sharp decline in transportation costs was partially offset by increases in all of the remaining major categories.  This was the largest 12-month decrease in the history of the index, dating back to December 1966.  Energy costs in the region declined 26.4 percent, while food prices increased 3.3 percent since last May.  Over the same period, the core inflation rate was 2.0 percent.

Among the major categories, the transportation index increased 2.4 percent during May, due almost entirely to higher motor fuel costs, which advanced 8.5 percent.  Over the year, transportation costs decreased 16.2 percent, dominated by a 41.3-percent drop in motor fuel prices.  This was the seventh consecutive month of over-the-year declines in the transportation index and the largest 12-month decrease since the inception of the series in December 1966.

Prices for education and communication edged up 0.2 percent in May.  Over the year, education and communication costs increased 3.2 percent. 

The index for medical care was unchanged in May, as costs for both components, medical care services and medical care commodities, showed no change.  Over the year, the medical care index advanced 2.6 percent, as prices increased for both medical care services (2.3 percent) and medical care commodities (3.3 percent).

The index for housing was unchanged over the month.  The shelter index, which includes rent of primary residence, lodging away from home, owners’ equivalent rent of primary residence, and tenants’ and household insurance, was unchanged since April.  Household furnishings and operations costs were also unchanged over the month.  The fuels and utilities index declined 0.4 percent in May, as costs for utility (piped) gas service decreased 3.4 percent and electricity costs were unchanged.  Since May 2008, the housing index rose 1.4 percent in the South as increases in shelter (1.8 percent) and household furnishings and operations (2.6 percent) were partially offset by a decline in the fuels and utilities index (-1.5 percent).

Apparel costs decreased 1.6 percent over the month, reflecting normal seasonal patterns.  Prices for apparel inched up 0.1 percent over the year.

The food and beverages index inched down 0.1 percent in May due to lower prices for both food at home (-0.1 percent) and alcoholic beverages (-0.5 percent).  Food away from home prices were 0.1 percent higher over the month.  Over the year, the food and beverages index advanced 3.2 percent, as prices rose for food away from home (4.7 percent), food at home (2.1 percent), and alcoholic beverages (2.7 percent).

The recreation index edged down 0.2 percent over the month but advanced 1.7 percent over the year.  The other goods and services index (which includes tobacco and smoking products, personal care products and services, and miscellaneous personal goods) inched down 0.1 percent in May.  Over the year, the other goods and services index rose 8.0 percent.

Population size groups

Over the month, consumer prices in the South inched up 0.1 percent in the largest metropolitan areas, those with 1.5 million or more residents (Size Class A).  Prices increased 0.3 percent in the mid-size areas, those with populations between 50,000 and 1.5 million (Size Class B/C), and advanced 0.8 percent in the smallest areas, those with populations of less than 50,000 (Size Class D).  Over the past 12 months, consumer prices in the South decreased 1.2 percent in the largest areas (Size Class A), fell 1.4 percent in the mid-sized areas (Size Class B/C), and declined 0.8 percent in the smallest areas (Size Class D).

Technical Note

The Bureau of Labor Statistics (BLS) has updated the consumption expenditure weights in the Consumer Price Index for All Urban Consumers (CPI-U) and Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) to the 2005-06 period.  The updated expenditure weights for these indexes replace the 2003-2004 weights that were introduced effective with the January 2006 CPI release. As originally announced by BLS in December 1998, CPI expenditure weights will continue to be updated at two year intervals.

The CPI program completed its conversion to Computer Assisted Data Collection (CADC).  Due to the efficiencies gained from conversion to CADC, BLS has extended data collection to cover the entire month, beginning with data for January 2004.  CPI data collection is scheduled in terms of business days – weekdays excluding holidays.  Formerly, data collection covered three pricing periods, each comprising six business days in most months and five days in November and December.  Consequently, the last day of scheduled data collection was usually the 18th business day of the month.  This allowed time during the end of the month for the mailing of paper schedules back to the Washington Office and the data entry of the information in these schedules.  Starting in January 2004, the three pricing periods now have variable lengths, between six and eight business days long.  The third pricing period normally will end on the last business day of the month.

Local area CPI indexes are by-products of the national CPI program.  Because each local index is a small subset of the national index, it has a smaller sample size and is, therefore, subject to substantially more sampling and measurement error than the national index, although their long-term trends are quite similar.  The Bureau of Labor Statistics strongly urges users to consider adopting the national average CPI for use in escalator clauses.

We encourage users interested in learning more about changes to the CPI to contact the Bureau of Labor Statistics. Information on the Consumer Price Index and other surveys are available on our Web site at www.bls.gov. Current and historical BLS data are also posted on our Web site at www.bls.gov/ro3/. If you have additional questions, you can contact the Mid-Atlantic information office directly by dialing (215) 597-3282. Information from the Consumer Price Index program is available to sensory impaired individuals upon request. Voice phone: 202-691-5200, Federal Relay Services: 1-800-877-8339.