The Consumer Price Index for All Urban Consumers (CPI-U) in the Chicago-Gary-Kenosha area was down 0.3 percent in December, the U.S. Bureau of Labor Statistics reported today. Regional Commissioner Charlene Peiffer noted that energy prices fell 2.0 percent while food prices rose 0.4 percent. The all items less food and energy category decreased 0.2 percent over the month. Among the indexes within the all items less food and energy category, prices were lower for apparel, shelter, and household furnishings and operations, and higher for recreation. (Data in this report are not seasonally adjusted. Accordingly, month-to-month changes may reflect the impact of seasonal influences.)

Over the last 12 months, the Chicago area all items CPI-U increased 1.7 percent. The energy index rose 1.9 percent since last December, primarily due to rising prices for gasoline and electricity. The all items less food and energy index was 1.5 percent higher over the year.

Food

Food prices were 0.4 percent higher in December after increasing 0.6 percent in November. Of the two components within the food index, prices for food at home (groceries) rose 0.4 percent and prices for food away from home (restaurant, cafeteria, and vending purchases) were up 0.5 percent over the month. Within the food at home group, prices were higher for potatoes and milk. Prices were lower for bread; rice, pasta, and cornmeal; and bacon, breakfast sausage, and related products.

From December 2011 to December 2012, the food index increased 2.4 percent. In the previous 12-month period ended December 2011, food prices in the Chicago area were up 3.3 percent.

Energy

The energy index decreased 2.0 percent in December following a 4.1-percent decrease in November. Within the energy category, prices for gasoline (-2.3 percent), electricity (-2.5 percent), and utility (piped) gas service (-0.6 percent) fell over the month.

The index for gasoline was up 3.4 percent and the electricity index was 3.1 percent higher over the year. Prices for utility (piped) gas service decreased 4.1 percent compared to a year ago. Overall energy prices increased 1.9 percent from December 2011 to December 2012.

All items less food and energy

The index for all items less food and energy fell 0.2 percent in December. Among the index’s components, prices were lower for apparel (-3.6 percent), shelter (-0.1 percent), and household furnishings and operations (-0.8 percent). Prices were higher for recreation (1.1 percent).

Over the year, the index for all items less food and energy increased 1.5 percent. Shelter was the largest contributor, rising 1.2 percent from December 2011 to December 2012. Costs for medical care (3.5 percent) and recreation (3.8 percent) also rose since last December.

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The January 2013 Consumer Price Index for Chicago is scheduled to be released on February 21, 2013, at 7:30 a.m. (CT).

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 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/homch17_a.htm.

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 cities; they only measure the average change in prices for each area since the base period.

The Chicago-Gary-Kenosha, Ill.-Ind.-Wis. consolidated area covered in this release is comprised of Cook, DeKalb, DuPage, Grundy, Kane, Kankakee, Kendall, Lake, McHenry, and Will Counties in Illinois; Lake and Porter Counties in Indiana; and Kenosha County in Wisconsin.

Information in this release will be made available to sensory impaired individuals upon request. Voice phone: (202) 691-5200; Federal Relay Service: (800) 877-8339.