Transmission of material in this release is embargoed until
 8:30 a.m. (EST) Wednesday, January 16, 2013   USDL-13-0057
 
 Technical information: (202)691-7000 Reed.Steve@bls.gov  www.bls.gov/cpi
 Media Contact:         (202)691-5902 PressOffice@bls.gov
 
                 Consumer Price Index - December 2012

 The Consumer Price Index for All Urban Consumers (CPI-U) was
 unchanged in December on a seasonally adjusted basis, the U.S. Bureau
 of Labor Statistics reported today. Over the last 12 months, the all
 items index increased 1.7 percent before seasonal adjustment.
 
 The gasoline index declined again in December, but other indexes,
 notably food and shelter, increased, resulting in the seasonally
 adjusted all items index being unchanged. Gasoline was the only major
 energy index to decline; the indexes for natural gas and electricity
 both increased.  Within the food category, five of the six major
 grocery store food groups increased as the food at home index rose
 for the third consecutive month.
 
 The index for all items less food and energy increased 0.1 percent in
 December, the same increase as in November. Besides shelter, the
 indexes for airline fares, tobacco, and medical care also increased.
 The indexes for recreation, household furnishings and operations, and
 used cars and trucks all declined in December.
 
 The all items index increased 1.7 percent over the last 12 months,
 compared to a 1.8 percent figure in November. The index for all items
 less food and energy rose 1.9 percent over the last 12 months, the
 same figure as last month. The food index has risen 1.8 percent over
 the last 12 months, and the energy index has risen 0.5 percent.

 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.
                              June  July  Aug.  Sep.  Oct.  Nov.  Dec.   ended 
                              2012  2012  2012  2012  2012  2012  2012   Dec.  
                                                                         2012  
                                                                                                                                                              
 All items..................    .0    .0    .6    .6    .1   -.3    .0      1.7
  Food......................    .2    .1    .2    .1    .2    .2    .2      1.8
   Food at home.............    .1    .0    .1    .0    .3    .3    .2      1.3
   Food away from home (1)..    .2    .2    .3    .2    .1    .1    .1      2.5
  Energy....................  -1.4   -.3   5.6   4.5   -.2  -4.1  -1.2       .5
   Energy commodities.......  -2.3    .2   8.6   6.7   -.5  -6.9  -2.2      1.5
    Gasoline (all types)....  -2.0    .3   9.0   7.0   -.6  -7.4  -2.3      1.7
    Fuel oil (1)............  -7.9   -.5   4.6   4.1   1.1   -.2    .0      3.6
   Energy services..........    .0  -1.1    .8    .7    .3    .9    .4     -1.1
    Electricity.............   -.5  -1.3    .2    .2    .5    .7    .2      -.5
    Utility (piped) gas                                                        
       service..............   1.7   -.2   2.8   2.0   -.2   1.3   1.3     -2.9
  All items less food and                                                      
     energy.................    .2    .1    .1    .1    .2    .1    .1      1.9
   Commodities less food and                                                   
      energy commodities....    .2    .0   -.2   -.2   -.1   -.1   -.2       .3
    New vehicles............    .2   -.1    .2   -.1   -.1    .2    .0      1.6
    Used cars and trucks....    .0   -.5   -.9  -1.4   -.9   -.5   -.4     -2.0
    Apparel.................    .5    .2   -.5    .3    .7   -.6   -.1      1.8
    Medical care commodities                                                   
       (1)..................    .1    .5    .3   -.1    .0   -.4   -.5      1.7
   Services less energy                                                        
      services..............    .2    .1    .1    .3    .3    .2    .2      2.5
    Shelter.................    .1    .1    .2    .2    .3    .2    .1      2.2
    Transportation services    -.2   -.2    .0    .5    .7    .2    .5      2.6
    Medical care services...    .7    .3    .2    .4    .0    .3    .3      3.7

   1 Not seasonally adjusted.



 Year in Review
 
 The CPI rose 1.7 percent in 2012 after a 3.0 percent increase in
 2011. This was the third smallest December-December increase of the
 past ten years and compares to a 2.4 percent average annual increase
 over the span.
 
 The energy index increased 0.5 percent in 2012, a sharp deceleration
 from its 6.6 percent increase in 2011. The gasoline index rose 1.7
 percent in 2012 after increasing 13.8 percent in 2010 and 9.9 percent
 in 2011. The household energy index declined in 2012, falling 1.1
 percent after increasing 1.8 percent in 2011. The fuel oil index rose
 3.6 percent in 2012, but the electricity index decreased 0.5 percent
 and the index for natural gas fell 2.9 percent, the fourth straight
 year it has declined.
 
 The index for food rose 1.8 percent in 2012, a deceleration from its
 4.7 percent increase in 2011. The index for food at home rose 1.3
 percent in 2012 compared to 6.0 percent in 2011. Five of the six
 major grocery store food group indexes rose in 2012, with increases
 ranging from 0.5 percent (dairy and related products) to 2.0 percent
 (other food at home). The nonalcoholic beverages group was the only
 index to decline, falling 0.2 percent. The index for food away from
 home rose 2.5 percent in 2012 after increasing 2.9 percent in 2011.
 
 The index for all items less food and energy decelerated slightly in
 2012, rising 1.9 percent after a 2.2 percent increase in 2011. This
 matches the average annual increase of 1.9 percent over the past ten
 years. Several indexes decelerated in 2012. The apparel index, which
 rose 4.6 percent in 2011, increased 1.8 percent in 2012. The index
 for new vehicles increased 1.6 percent in 2012 after rising 3.2
 percent in 2011, and the medical care index rose 3.2 percent in 2012
 after a 3.5 percent increase the prior year. The index for airline
 fares rose 2.1 percent, the tobacco index increased 1.9 percent, and
 the recreation index rose 0.8 percent; all of these increases were
 smaller than in 2011. The index for household furnishings and
 operations was unchanged in 2012 after rising in 2011, and the index
 for used cars and trucks turned down in 2012, falling 2.0 percent
 after increasing 4.0 percent in 2011. In contrast, the shelter index
 accelerated in 2012, rising 2.2 percent after a 1.9 percent increase
 in 2011. The index for rent rose 2.7 percent and the index for
 owners' equivalent rent increased 2.1 percent.
 
 Consumer Price Index Data for December 2012
 
 Food
 
 The food index rose 0.2 percent in December for the third month in a
 row. The index for food at home increased 0.2 percent after rising
 0.3 percent in each of the two previous months. The index for meat,
 poultry, fish, and eggs was unchanged in December, while the
 remaining major grocery store food group indexes all increased. The
 fruits and vegetables index posted the largest increase, rising 0.6
 percent; this was its seventh increase in the last nine months. The
 indexes for cereals and bakery products, dairy and related products,
 and nonalcoholic beverages, which all rose in November, each
 increased 0.2 percent in December. The index for other food at home
 increased 0.1 percent in December after rising 0.4 percent in
 November. The index for food away from home rose 0.1 percent in
 December, the same increase as in October and November.
 
 Energy
 
 The energy index declined 1.2 percent in December after declining 4.1
 percent in November. The gasoline index, which fell 7.4 percent in
 November, declined 2.3 percent. It has decreased 10.1 percent since
 its recent peak in September. (Before seasonal adjustment, gasoline
 prices decreased 4.2 percent in December.) The index for fuel oil was
 unchanged in December, while other major energy components increased.
 The natural gas index rose 1.3 percent in December, the same increase
 as in November. The index for electricity rose 0.2 percent, its fifth
 consecutive increase.
 
 All items less food and energy
 
 The index for all items less food and energy increased 0.1 percent in
 December, the same increase as in November. The shelter index rose
 0.1 percent in December after increasing 0.2 percent in November. The
 rent index rose 0.2 percent and the index for owners' equivalent rent
 increased 0.1 percent, while the lodging away from home index
 declined 0.9 percent. The index for airline fares continued to rise,
 increasing 1.2 percent in December. This was its fourth consecutive
 increase and it has risen 6.5 percent since August. The index for
 medical care increased 0.1 percent as the medical care services index
 rose but the index for medical care commodities declined. The tobacco
 index rose 0.5 percent in December, its first increase since
 September. In contrast to these increases, the recreation index
 declined in December, falling 0.2 percent. The index for household
 furnishings and operations also fell 0.2 percent, while the index for
 used cars and trucks declined 0.4 percent, its sixth consecutive
 decrease. The indexes for apparel and personal care both declined 0.1
 percent in December. The index for new vehicles, which rose 0.2
 percent in November, was unchanged in December.
 
 Not seasonally adjusted CPI measures
 The Consumer Price Index for All Urban Consumers (CPI-U) increased
 1.7 percent over the last 12 months to an index level of 229.601
 (1982-84=100). For the month, the index declined 0.3 percent prior to
 seasonal adjustment.
 
 The Consumer Price Index for Urban Wage Earners and Clerical Workers
 (CPI-W) increased 1.7 percent over the last 12 months to an index
 level of 225.889  (1982-84=100). For the month, the index decreased
 0.3 percent prior to seasonal adjustment.
 
 The Chained Consumer Price Index for All Urban Consumers (C-CPI-U)
 increased 1.6 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 post-2010 period are subject to
 revision.
 
 
 The Consumer Price Index for January 2013 is scheduled to be released
 on Thursday, February 21, 2013, at 8:30 a.m. (EST).
 
 
 
 
 
 
 
 Discontinuation of Department Store Inventory Indexes
 
 The Bureau of Labor Statistics will discontinue publication of its
 Department Store Inventory indexes after the release of the December
 2013 CPI in mid-January 2014, and these values will no longer be
 uploaded to the Labstat database. For further information please
 contact Sharon Gibson at 202-691-6968 or gibson.sharon@bls.gov.
 
 Publication Changes for Average Price Series
 
 The Bureau of Labor Statistics will discontinue publication of three
 average price series after the release of the June 2013 CPI in mid-
 July 2013. They are:
 
-         utility (piped) gas, 40 therms;
-         utility (piped) gas, 100 therms; and
-         electricity, 500 kilowatt hours.
 
 The Bureau will, however, continue to publish average prices for
 utility (piped) gas on a per therm basis, and will continue to
 publish electricity prices on a per kilowatt hour basis. As such,
 users will be able to convert these data to any consumption amount.
  CPI Detailed Report table P1. Average residential prices for utility
 (piped) gas, electricity, and fuel oil, U.S. city average and
 selected areas will no longer be published.  Data for fuel oil #2,
 per gallon (3.785 liters) will continue to be available in the CPI
 Average Price Data public database.
 
 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 29 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 cover approximately 88 percent of the
 total population and include 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 0.03 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 0.06 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 for All Urban Consumers, 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 "Variance Estimates for Price Changes in the
 Consumer Price Index, January-December 2011".  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/cpivar2011.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-12-ARIMA Seasonal Adjustment Method.  Seasonally
 adjusted indexes and seasonal factors are computed annually.  Each
 year, the last 5 years of seasonally adjusted data are revised.  Data
 from January 2007 through December 2011 were replaced in January
 2012.  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 54 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 5 years, but the seasonally adjusted indexes before that
 period will not be changed.  Note: 38 of the 82 components are not
 seasonally adjusted for 2012.
 
 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.
 
 For the seasonal factors introduced in January 2012, 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 damage to oil
 refineries from Hurricane Katrina.
 
 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 Christopher Graci
 by electronic mail at Graci.Christopher@bls.gov or by telephone at
 (202) 691-5826, or Carlyle Jackson by electronic mail at
 Jackson.Carlyle@bls.gov or by telephone at (202) 691-6984. If you
 have general questions about the CPI, please call our information
 staff at (202) 691-7000.
 
 
 Recalculated Seasonally Adjusted Indexes to be Available on February
 19, 2013
 
 Each year with the release of the January CPI, seasonal adjustment
 factors are recalculated to reflect price movements from the just-
 completed calendar year. This routine annual recalculation may result
 in revisions to seasonally adjusted indexes for the previous 5 years.
 BLS will make available recalculated seasonally adjusted indexes, as
 well as recalculated seasonal adjustment factors, for the period
 January 2008 through December 2012, on Tuesday, February 19, 2013.
 This date is two working days before the scheduled release of the
 January 2013 CPI on Thursday, February 21, 2013.
 
 The revised indexes and seasonal factors will be available on the
 internet. The address is
 http://www.bls.gov/cpi/cpisapage.htm. Look under Seasonal Adjustment
 in the CPI and select Revised Seasonally Adjusted Indexes and
 Factors, 2008-2012.
 
 For further information please contact Christopher Graci by
 electronic mail at Graci.Christopher@bls.gov or by telephone at (202)
 691-5826, or Carlyle Jackson by electronic mail at
 Jackson.Carlyle@bls.gov or by telephone at (202) 691-6984.