The Consumer Price Index for All Urban Consumers (CPI-U) for the Kansas City, Mo.-Kan., metropolitan area increased 0.4 percent from the first half of 2013 to the first half of 2014, the smallest annual gain since semi-annual publication began in 1984, the U.S. Bureau of Labor Statistics reported today. Regional Commissioner Stanley W. Suchman noted that the indexes for food and shelter had the largest upward impact on the all items index. Costs for energy were up 0.9 percent, food prices increased 2.3 percent, and the all items less food and energy index was unchanged over the year.

Food

Food prices advanced 2.3 percent from the first half of 2013 to the first half of 2014. Within the food index, costs for food at home were up 2.6 percent and prices for food away from home increased 2.0 percent. These compared with gains of 1.0 percent and 3.3 percent, respectively, in the 12-month period that ended in the first half of 2013.  

Energy

The energy index, which includes motor fuel and household fuels, advanced 0.9 percent from the first half of 2013 to the first half of 2014, with all of the increase occurring in the most recent six months of the period. Higher prices for utility (piped) gas service (11.7 percent) were largely responsible for the increase in the energy component. Costs for electricity rose a modest 0.2 percent over the year and contributed to the increase. Moderating the advance in energy costs, the motor fuel index declined 1.9 percent over the period.

All items less food and energy

The index for all items less food and energy was unchanged from the first half of 2013 to the first half of 2014, following a gain of 1.9 percent in the same period one year ago. Shelter costs advanced 0.9 percent. Prices for recreation and other goods and services rose 0.7 and 0.4 percent, respectively, over the year. In contrast, the index for education and communication declined 2.3 percent, medical care costs decreased 1.2 percent, and prices for apparel were down 1.4 percent from the first half of 2013 to the first half of 2014.

The Kansas City CPI-U stood at 222.842 for the first half of 2014. This means that a market basket of goods and services that cost $100.00 in 1982-84 cost $222.84 in the first half of 2014. Because metropolitan area CPI data are not adjusted for seasonal price variation, consumers and businesses should be cautious in drawing conclusions about long-term retail price trends from short-term changes in the metropolitan area indexes.

CPI-W

The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the Kansas City, Mo.-Kan., metropolitan area for the first half of 2014 was 214.905. The CPI-W increased 0.3 percent from the first half of 2013 to the first half of 2014.

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 88 percent of the total population and (2) a CPI for Urban Wage Earners and Clerical Workers (CPI-W) which covers approximately 29 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 areas; they only measure the average change in prices for each area since the base period.

The Kansas City, Mo.-Kan., area covered in this release includes Johnson, Leavenworth, Miami, and Wyandotte Counties in Kansas; and Cass, Clay, Clinton, Jackson, Lafayette, Platte, and Ray Counties in Missouri.

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