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FOR RELEASE: February 20, 2009

 

CONSUMER PRICE INDEX (CPI) FOR KANSAS CITY, MO-KS

Prices increased 2.9 percent from the second half of 2007 to the second half of 2008

The Consumer Price Index for All Urban Consumers (CPI-U) for the Kansas City metropolitan area increased 2.9 percent over the year, with most of the increase occurring in the first half of the period, the Bureau of Labor Statistics reported today. According to Regional Commissioner Stanley W. Suchman, while prices in six of the eight major expenditure categories were higher in the second half of 2008 than in the second half of 2007, over two-thirds of the movement in the overall index was attributable to rising costs for housing and food and beverages.

The housing index rose 3.1 percent due to upward pressure from both the fuels and utilities and the shelter components, and had the largest effect on the overall index among the eight major expenditure categories. Prices for fuels and utilities advanced 11.7 percent from the second half of 2007 to the second half of 2008. Within fuels and utilities, electricity costs rose 9.4 percent over the year and the index for utility (piped) gas service jumped 18.3 percent following an increase of 3.2 percent in the same period one year ago. Contributing to the 1.6 percent rise in shelter costs, owners' equivalent rent of primary residence increased 1.7 percent and rent of primary residence was up 2.3 percent. Prices for household furnishings and operations were 1.9 percent higher over the year.

The food and beverages index was up 7.4 percent from the second half of 2007 to the second half of 2008, the largest over-the-year advance since semiannual publication of the index began in 1985, and had the second greatest impact on the overall index. Food at home prices advanced 8.4 percent and the cost of food away from home was up 6.0 percent. Prices for alcoholic beverages increased 6.2 percent over the period.

Transportation costs were up 2.1 percent since the second half of 2007. Private transportation costs, which include prices for vehicles and motor fuel, rose 1.5 percent. Motor fuel prices were up just 0.6 percent from the second half of 2007 to the second half of 2008 after increases in the first part of the year were partially offset by declines in the last half of 2008.

The remaining major expenditure categories contributed little to the increase in the overall index. Costs for education and communication rose 3.0 percent from the second half of 2007 to the second half of 2008. Recreation prices, which include admissions to movies, concerts, and sporting events, increased 2.5 percent. Providing a slight downward impact, medical care costs declined by 1.9 percent and the apparel index declined 2.5 percent following a decrease of 3.8 percent in the same period one year ago. The other goods and services index, which includes prices for tobacco and smoking products and personal care items, rose 1.4 percent.

Energy prices, which include prices for motor fuel and household fuels, were up 6.5 percent over the year, with prices declining in the last half of the year after increasing sharply in the first half. The special aggregate index for all items less energy rose 2.4 percent over the year. Excluding the impact of food and energy prices, the Kansas City CPI-U was up 1.4 percent from the second half of 2007 to the second half 2008.

The Kansas City CPI-U stood at 201.432 for the second half of 2008. This means that a market basket of goods and services that cost $100.00 in 1982-84 cost $201.43 in the second half of 2008. 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.

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