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Consumer Price Index Midwest Region September 2008

 

The Consumer Price Index for the Midwest was unchanged in September after decreasing 0.3 percent in August.  The index was up 4.8 percent from September 2007, the U.S. Department of Labor’s Bureau of Labor Statistics reported today.  According to Regional Commissioner Jay A. Mousa, prices for housing and transportation declined for the second straight month.  In September, these declines were offset by increases in other major expenditure categories.  Energy prices, down 2.0 percent over the month, have advanced 21.2 percent since September 2007.  The Midwest CPI for all items less energy was 0.2 percent higher over the month and was up 2.9 percent over the year. 

Among the eight major expenditure categories, lower housing costs had the largest impact on the overall index in September 2008.  The housing index decreased 0.6 percent over the month, largely attributable to a 9.6 percent fall in utility (piped) gas service costs.  This followed an August decline of 6.8 percent and was the largest 1-month decrease in utility (piped) gas service costs since Midwest publication began in December 1977.  The household fuels and utilities index registered a monthly decline of 3.4 percent in September with electricity prices up 0.5 percent.  Shelter costs inched down 0.2 percent with price decreases in lodging away from home offsetting a 0.3 percent increase in rent of primary residence and a slight 0.2 percent rise in owners’ equivalent rent of primary residence.  From September 2007 to September 2008, housing costs increased 2.8 percent in the Midwest.  Shelter costs rose 0.9 percent and prices for household fuels and utilities were up 13.4 percent.  Within fuels and utilities, electricity prices rose 5.9 percent over the year, and prices for utility (piped) gas service climbed 26.7 percent.  The household furnishings and operations index was up 2.2 percent over the 12-month period.

Partially countering the declines in housing costs, the apparel index rose 4.5 percent in September.  Apparel prices typically increase in September as retailers introduce fall merchandise.  Prices for apparel were up 3.8 percent from the previous year.

The transportation index decreased 0.8 percent, largely reflecting a downturn in prices for new and used motor vehicles.  Prices for new vehicles and for used cars and trucks declined in September, down 1.1 and 1.7 percent, respectively.  Motor fuel costs were down 0.6 percent over the month.  Overall, transportation prices have risen 10.1 percent since September 2007 led by an over-the-year increase of 26.7 percent in motor fuel costs.  Prices for new vehicles were 1.7 percent lower and prices for used cars and trucks were down 2.4 percent.

The food and beverages index rose 0.6 percent in September with prices for food at home up 0.8 percent and prices for food away from home 0.4 percent higher.  Prices for alcoholic beverages increased 0.4 percent over the month.  From September 2007 to September 2008, prices for food and beverages rose 6.5 percent.  Prices for food at home advanced by the largest amount since June 1981, increasing 8.1 percent over the year, and prices for food away from home rose 5.0 percent.  Alcoholic beverages’ prices increased 3.3 percent since September 2007.

The remaining four major expenditure categories—education and communication, medical care, recreation, and other goods and services—had less impact on the overall monthly index.  The education and communication index rose 0.6 percent in September and 3.2 percent over the year.  Medical care costs were up 0.4 percent over the month and were 2.2 percent higher than in September 2007.  Prices for recreation rose 0.4 percent for the month and 3.5 percent over the year.  Other goods and services prices were nearly unchanged in September, but advanced 3.8 percent over the year

The Midwest Consumer Price Index for All Urban Consumers (CPI-U) stood at 209.252 in September.  A typical market basket of goods and services that cost $100.00 in the 1982-84 base period cost $209.25 in September 2008.  Because regional 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 regional indexes.

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Scheduled release date for the October 2008 CPI: Wednesday, November 19, 2008

CPI HOTLINE SERVICE PROVIDES LATEST INDEXES 24 HOURS A DAY

The all items CPI-U and CPI-W for the U.S. City Average, the Midwest region, and the Chicago area are available to the public 24 hours a day, 7 days a week through the Bureau’s CPI Hotline service. This recorded message also provides percent changes from the prior period and from a year earlier, as well as the scheduled release date for the next CPI issuance. The Hotline number in Chicago is (312) 353-1880, menu option 2.

BRIEF EXPLANATION OF THE CPI

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 87 percent of the total population and (2) a CPI for Urban Wage Earners and Clerical Workers (CPI-W) which covers 32 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. Prices are collected in 87 urban areas across the country from about 50,000 housing units and approximately 23,000 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 food, 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 of the Bureau’s trained representatives.

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. 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.

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/homch17_a.htm. 

 

Last Modified Date: October 16, 2008