June 28, 1999 (The Editor’s Desk is updated each business day.)

Food inflation leaner in new research series

Throughout 1978-98, annual growth in food and beverage prices was lower in the new CPI research series than in the official Consumer Price Index. Reductions ranged from 0.1 percentage point in 1997 up to 0.7 percentage point in 1990. On average, about half a percentage point a year was sliced off of food inflation.

[Chart data—TXT]

The food CPI climbed at a double-digit pace between 1978 and 1980—the research series brought the growth in food prices to under 10 percent in two of those three years. Since 1990, the official rate of food inflation was no higher than 2.7 percent in every year except 1996. In the research series in 1991-98, the annual change in food prices was less than or equal to 2.1 percent each year other than 1996.

CPI data are produced by the BLS Consumer Price Index program. BLS has made numerous improvements to the CPI over the years, which have increased the accuracy of the index; however, the official historical price indexes are not adjusted to reflect the improvements. More information on the CPI research series can be found in "CPI research series using current methods, 1978-98," by Kenneth J. Stewart and Stephen B. Reed, Monthly Labor Review preprint, June 1999. It is important to note that the CPI research series has certain limitations and that it is subject to revision. Annual percent changes are December-to-December changes.