June 22, 1999 (The Editor’s Desk is updated each business day.)
Apparel prices adjusted downward
the most in new research series
Consumer prices for apparel were adjusted downward more than
prices for any other major group of items in the new CPI research series. On average,
apparel inflation was reduced by about a percentage point per year in 1978-98 using the
new research index.
[Chart data—TXT]
Most of the inflation rates for major groups of consumer items in 1978-98 were lowered
in the new research series, but the reduction was by far the greatest in apparel. For
example, the research series shaved 0.49 percentage point per year off the measured growth
of food prices, 0.57 percentage point off of housing prices, and 0.62 percentage point off
of entertainment prices. In contrast, it knocked 1.10 percentage points off of apparel
prices.
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. The research series attempts to answer the question, "What
would have been the measured rate of inflation from 1978 forward had the methods currently
used in calculating the Consumer Price Index been in use since 1978?"
CPI data are produced by the BLS Consumer Price Index
program. 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. Growth rates reflect December-to-December
changes. The growth rate for entertainment in the chart refers to 1978-97, as
entertainment was dropped as a major group in December 1997.
Of interest
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