Transmission of material in this release is embargoed until                                        
 8:30 a.m. (EDT) August 11, 2017                USDL-17-1100     

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

 CONSUMER PRICE INDEX – JULY 2017

 The Consumer Price Index for All Urban Consumers (CPI-U) rose 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 rose 1.7 percent.

 The indexes for shelter, medical care, and food all rose in July, leading to
 the seasonally adjusted increase in the all items index. The energy index
 declined slightly in July, with its major component indexes mixed. The index
 for natural gas declined, while the electricity index rose and the gasoline
 index was unchanged. The food index increased 0.2 percent, with the indexes
 for food at home and food away from home both rising. 

 The index for all items less food and energy rose 0.1 percent, the fourth
 month in a row it increased by that amount. The indexes for shelter, medical
 care, recreation, apparel, motor vehicle insurance, and airline fares all
 rose in July. These increases more than offset declines in the indexes for
 new vehicles, communication, used cars and trucks, and household furnishings
 and operations.    

 The all items index rose 1.7 percent for the 12 months ending July, a
 slightly larger increase than for the 12 months ending June. The index for
 all items less food and energy also rose 1.7 percent for the 12 month period,
 the same increase as for the 12 months ending May and June. The energy index
 rose 3.4 percent over the last year, while the food index increased
 1.1 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.
                              Jan.  Feb.  Mar.  Apr.  May   June  July   ended 
                              2017  2017  2017  2017  2017  2017  2017   July  
                                                                         2017  
                                                                               
                                                                               
 All items..................    .6    .1   -.3    .2   -.1    .0    .1      1.7
  Food......................    .1    .2    .3    .2    .2    .0    .2      1.1
   Food at home.............    .0    .3    .5    .2    .1   -.1    .2       .3
   Food away from home (1)..    .4    .2    .2    .2    .2    .0    .2      2.1
  Energy....................   4.0  -1.0  -3.2   1.1  -2.7  -1.6   -.1      3.4
   Energy commodities.......   7.6  -2.8  -6.0   1.3  -6.2  -2.7    .0      3.1
    Gasoline (all types)....   7.8  -3.0  -6.2   1.2  -6.4  -2.8    .0      3.0
    Fuel oil (1)............   3.5   -.4   -.8   -.3  -2.8  -3.7  -2.0      3.6
   Energy services..........    .3   1.0   -.3    .9    .7   -.5   -.2      3.6
    Electricity.............    .0    .8   -.1    .6    .3   -.6    .4      2.6
    Utility (piped) gas                                                        
       service..............   1.5   1.5   -.8   2.2   1.9   -.2  -2.3      7.5
  All items less food and                                                      
     energy.................    .3    .2   -.1    .1    .1    .1    .1      1.7
   Commodities less food and                                                   
      energy commodities....    .4    .0   -.3   -.2   -.3   -.1   -.1      -.6
    New vehicles............    .9   -.2   -.3   -.2   -.2   -.3   -.5      -.6
    Used cars and trucks....   -.4   -.6   -.9   -.5   -.2   -.7   -.5     -4.1
    Apparel.................   1.4    .6   -.7   -.3   -.8   -.1    .3      -.4
    Medical care commodities    .3   -.2    .2   -.8    .4    .7   1.0      3.7
   Services less energy                                                        
      services..............    .3    .3   -.1    .1    .2    .2    .2      2.4
    Shelter.................    .2    .3    .1    .3    .2    .2    .1      3.2
    Transportation services     .6    .7    .4   -.2    .3    .2    .2      3.2
    Medical care services...    .2    .2    .1    .0   -.1    .3    .3      2.3

   1 Not seasonally adjusted.


 Food

 The food index rose 0.2 percent in July after being unchanged in June. The index
 for food at home, which declined in June, rose 0.2 percent in July. Major grocery
 store food group index movements were mixed in July. The index for meats, poultry,
 fish, and eggs rose 0.7 percent following a 0.6-percent rise the prior month, as
 the beef index continued to increase. The index for fruits and vegetables rose
 0.5 percent after declining in June. The index for dairy and related products also
 turned up in July, rising 0.3 percent after a 0.5-percent decrease in June.

 In contrast, the index for cereals and bakery products declined 0.4 percent in
 July, and the index for nonalcoholic beverages fell 0.3 percent. The index for
 other food at home was unchanged in July after falling in May and June.

 The index for food at home rose 0.3 percent over the last 12 months, the first
 12-month increase since the period ending November 2015. Five of the six major
 grocery store food group indexes rose over the last 12 months, though none more than
 1.0 percent. The index for cereals and bakery products was the only group to decline
 over the past year, falling 0.5 percent. The index for food away from home increased
 0.2 percent in July and rose 2.1 percent over the past year.
 
 Energy

 The energy index decreased 0.1 percent in July, its third consecutive decline. The
 gasoline index, which declined in May and June, was unchanged in July. (Before
 seasonal adjustment, gasoline prices decreased 2.3 percent in July.) The index for
 natural gas fell 2.3 percent in July, its largest decline since April 2015. The
 electricity index rose 0.4 percent in July after declining in June.

 The major energy component indexes all increased over the past 12 months. The index
 for natural gas rose 7.5 percent, the gasoline index increased 3.0 percent, and the
 index for electricity advanced 2.6 percent.

 All items less food and energy

 The index for all items less food and energy increased 0.1 percent in July. The
 shelter index rose 0.1 percent in July, its smallest increase since March. The rent
 index increased 0.2 percent, while the index for owners' equivalent rent rose
 0.3 percent. However, the index for lodging away from home fell sharply, declining
 4.2 percent. The medical care index rose 0.4 percent in July, the same increase as
 in June. The index for prescription drugs continued to rise, increasing 1.3 percent
 in July after rising 1.0 percent in June. The index for hospital services rose
 0.5 percent, and the physicians' services index advanced 0.1 percent. 

 The recreation index rose 0.3 percent in July, its largest increase since February.
 The index for apparel rose 0.3 percent after declining in each of the past four
 months. The index for airline fares also turned up in July, rising 0.7 percent
 following 3 months of declines. The index for motor vehicle insurance continued to
 increase, rising 0.3 percent. 

 In contrast, several indexes declined in July. The index for new vehicles fell
 0.5 percent, its largest decline since August 2009. The communication index
 continued to fall, declining 0.2 percent as the index for wireless telephone
 services fell 0.3 percent. The index for used cars and trucks fell 0.5 percent, its
 seventh consecutive decline, and the index for household furnishings and operations
 fell 0.2 percent.
 
 The index for all items less food and energy rose 1.7 percent over the past
 12 months, similar to its 1.8 percent average annual increase over the past
 10 years. The shelter index rose 3.2 percent over the year, and the index
 for medical care rose 2.6 percent. 

 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 244.786 (1982-84=100). For the
 month, the index decreased 0.1 percent prior to seasonal adjustment.

 The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W)
 increased 1.6 percent over the last 12 months to an index level of 238.617
 (1982-84=100). For the month, the index decreased 0.1 percent prior to seasonal
 adjustment.

 The Chained Consumer Price Index for All Urban Consumers (C-CPI-U) increased
 1.5 percent over the last 12 months. For the month, the index decreased 0.1 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 August 2017 is scheduled to be released on Thursday,
 September 14, 2017, at 8:30 a.m. (EDT).

 ----------------------------------------------------------------------------------
                   Consumer Price Index Geographic Revision for 2018

 In January 2018, BLS will introduce a new geographic area sample for the Consumer 
 Price Index (CPI). The 2018 revision utilizes the 2010 Decennial Census and 
 incorporates an updated area sample design, changes the frequency of publication 
 for several local area indexes, and establishes some new local area and aggregate 
 indexes. The first indexes using the new structure will be published in February 
 2018. Additional information on the geographic revision is available at: 
 www.bls.gov/cpi/georevision2018.htm. 
 ----------------------------------------------------------------------------------		



 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 89 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 28 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 87 urban areas across the
 country from about 6,000 housing units and approximately 24,000 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 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 27 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/cpivar2016.pdf. 

 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  8.0/225.000 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. For more information on data
 revision scheduling, please see the Fact Sheet on SeasonalAdjustment at
 www.bls.gov/cpi/cpisaqanda.htm and the Timeline of Seasonal Adjustment Methodological Changes
 at www.bls.gov/cpi/cpiseastimeline.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 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 in January 2017, BLS adjusted 40 series using intervention
 analysis seasonal adjustment, including selected food and beverage items, motor fuels, and natural
 gas. 

 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. In January 2017, revised seasonal factors and seasonally adjusted
 indexes for 2012 to 2016 were calculated and published. For series which are directly adjusted
 using the Census X-13ARIMA-SEATS seasonal adjustment software, the seasonal factors for 2016 will
 be applied to data for 2017 to produce the seasonally adjusted 2017 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. Twenty-seven of the 81 components of the U.S. city average all items index are
 not seasonally adjusted for 2017.

 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 cpi_info@bls.gov. 

 For additional information on seasonal adjustment in the CPI visit www.bls.gov/cpi/cpisapage.htm or
 contact the CPI seasonal adjustment section at 202-691-6968 or cpiseas@bls.gov. 

 Information from this release will be made available to sensory impaired individuals upon request.
 Voice phone: 202-691-5200; Federal Relay Service: 1-800-877-8339.