Consumer Price Index, Minneapolis-St. Paul, Minn.-Wis., CMSA – First Half 2012

The Consumer Price Index for All Urban Consumers (CPI-U) in the Minneapolis-St. Paul area rose 3.0 percent from the first half of 2011 to the first half of 2012, the U.S. Bureau of Labor Statistics reported today. Regional Commissioner Charlene Peiffer stated that the energy index was 3.3 percent lower compared to its first half 2011 level, primarily due to decreases in utility (piped) gas service prices. Food prices and the index for all items less food and energy were both up 3.6 percent over the same period. Among the categories within the all items less food and energy index, prices for shelter and apparel were higher over the year.

Food

Food prices rose 3.6 percent over the year after increasing 4.6 percent from the first half of 2010 to the first half of 2011. Prices for food at home were 4.5 percent higher and the food away from home index rose 2.6 percent.

Energy

The energy index declined 3.3 percent from the first half of 2011 to the first half of 2012. Within the energy category, the index for utility (piped) gas service fell 20.9 percent. The index for gasoline was 1.3 percent lower and the electricity index increased 0.8 percent.

All items less food and energy

Over the year, the index for all items less food and energy increased 3.6 percent. Among the index’s components, higher costs were recorded for shelter (2.0 percent) and apparel (11.4 percent).

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The second half 2012 Consumer Price Index for Minneapolis-St. Paul is scheduled to be released in February 2013.

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 Minneapolis-St. Paul, Minn.-Wis. metropolitan are covered in this release is comprised of Anoka, Carver, Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, and Wright Counties and Pierce and St. Croix Counties in Wisconsin.

Information in this release will be made available to sensory impaired individuals upon request. Voice phone: 202-691-5200; TDD message referral phone number: 1-800-877-8339.