The Consumer Price Index for All Urban Consumers (CPI-U) in the Northeast declined 0.5 percent in December, the U.S. Bureau of Labor Statistics reported today. A 4.2-percent decline in the energy index since November was joined by a 0.3-percent decrease in the all items less food and energy index; the food index rose 0.5 percent over the month. (Data in this report are not seasonally adjusted. Accordingly, month-to-month changes may reflect the impact of seasonal influences.) 

Over the last 12 months, the CPI-U increased 0.4 percent, due mainly to an advance in the all items less food and energy index, up 1.2 percent. (See chart 1 and table A.) The food index also rose since December 2013, up 3.1 percent, while the energy index fell 10.9 percent. (See table 1.)

Food

Over the month, food prices increased 0.5 percent. Food at home prices rose 0.7 percent and those for food away from home inched up 0.1 percent since November.

Over the year, the food index advanced 3.1 percent. Prices were higher for both the food at home and food away from home components, up 3.5 and 2.6 percent, respectively, since December 2013.

Energy

The energy index, which includes prices for household and transportation fuels, declined for the seventh consecutive month, down 15.3 percent since May and 4.2 percent since November. This month’s decrease was also the largest decline for this index since December 2008. The decrease was due almost entirely to a 7.8-percent drop in gasoline prices, which matched the previous month’s drop. Prices also decreased for electricity, down 0.5 percent, while those for utility (piped) gas service increased 2.3 percent in December.

Energy prices declined over the year, down 10.9 percent, dominated by a 19.7-percent drop in gasoline prices—the largest over-the-year decline since September 2009. Utility (piped) gas service prices were also lower since December 2013, down 1.4 percent, while electricity prices rose 2.8 percent.

All items less food and energy

The index for all items less food and energy edged down 0.3 percent over the month, led by a 4.6-percent seasonal decrease in apparel prices. Higher prices for medical care (0.2 percent), among others, moderated the decline in the all items less food and energy index since November.

The all items less food and energy index rose 1.2 percent over the year. The advance primarily reflected a 2.2-percent increase in prices for shelter. Price declines for household furnishings and operations (-1.4 percent) and recreation (-0.6 percent) moderated the 12-month advance in the all items less food and energy index.

 

Table A. Northeast region CPI-U 1-month and 12-month percent changes, all items index (not seasonally adjusted)

Month	2009		2010		2011		2012		2013		2014
	1-month	12-month	1-month	12-month	1-month	12-month	1-month	12-month	1-month	12-month	1-month	12-month
January	0.2	0.5	0.4	3.0	0.4	1.6	0.4	2.9	0.3	1.8	0.6	1.5
February	0.6	0.7	0.0	2.5	0.5	2.0	0.4	2.8	0.6	2.0	0.1	1.0
March	0.2	0.2	0.3	2.6	0.8	2.5	0.5	2.5	0.0	1.5	0.5	1.5
April	0.2	-0.1	0.2	2.5	0.5	2.8	0.3	2.3	-0.1	1.1	0.0	1.6
May	0.1	-0.8	0.2	2.6	0.5	3.2	-0.1	1.7	0.0	1.2	0.4	2.0
June	0.8	-1.2	-0.1	1.7	0.1	3.4	-0.2	1.5	0.1	1.5	0.0	1.9
July	0.1	-1.9	0.0	1.6	0.2	3.6	-0.1	1.1	0.2	1.8	0.1	1.8
August	0.3	-1.2	0.1	1.4	0.3	3.8	0.5	1.3	0.2	1.5	-0.3	1.3
September	0.1	-0.7	-0.1	1.2	0.1	4.0	0.5	1.7	0.1	1.1	0.0	1.2
October	0.0	0.2	0.3	1.5	-0.1	3.6	0.1	1.9	-0.4	0.7	-0.2	1.4
November	0.2	2.0	0.2	1.5	-0.1	3.2	0.2	1.8	0.1	1.0	-0.4	0.9
December	-0.1	2.8	0.0	1.6	-0.3	2.9	-0.3	1.8	0.0	1.3	-0.5	0.4

The January 2015 Consumer Price Index for the Northeast region is scheduled to be released on February 26, 2015, at 8:30 a.m. (ET).

Technical Note

The Consumer Price Index (CPI) is a measure of the average change in prices over time in a fixed market basket of goods and services. The Bureau of Labor Statistics publishes CPIs for two population groups: (1) a CPI for All Urban Consumers (CPI-U) which covers approximately 89 percent of the total population and (2) a CPI for Urban Wage Earners and Clerical Workers (CPI-W) which covers 28 percent of the total population. The CPI-U includes, in addition to wage earners and clerical workers, 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 CPI is based on prices of food, clothing, shelter, and fuels, transportation fares, charges for doctors’ and dentists’ services, drugs, and the other goods and services that people buy for day-to-day living. Each month, prices are collected 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.

The index measures price changes from a designated reference date (1982-84) that equals 100.0. An increase of 16.5 percent, for example, is shown as 116.5. 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 see the CPI home page on the Internet at www.bls.gov/cpi and the BLS Handbook of Methods, Chapter 17, The Consumer Price Index, available on the Internet at www.bls.gov/opub/hom/cpi/.

In calculating the index, price changes for the various items in each location are averaged together with weights that represent their importance in the spending of the appropriate population group. Local data are then combined to obtain a U.S. city average. Because the sample size of a local area is smaller, the local area index is subject to substantially more sampling and other measurement error than the national index. In addition, local indexes are not adjusted for seasonal influences. As a result, local area indexes show greater volatility than the national index, although their long-term trends are quite similar. NOTE: Area indexes do not measure differences in the level of prices between cities; they only measure the average change in prices for each area since the base period.

The Northeast region is comprised of Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont.

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