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INTERNET ADDRESS: http://www.bls.gov/cpi/ Wednesday, April 16,
2008
CONSUMER PRICE INDEX: MARCH 2008
The Consumer Price Index for All Urban Consumers (CPI-U) increased
0.9 percent in March, before seasonal adjustment, the Bureau of Labor
Statistics of the U.S. Department of Labor reported today. The March
level of 213.528 (1982-84=100) was 4.0 percent higher than in March 2007.
The Consumer Price Index for Urban Wage Earners and Clerical Workers
(CPI-W) increased 0.9 percent in March, prior to seasonal adjustment. The
March level of 209.147 (1982-84=100) was 4.3 percent higher than in March
2007.
The Chained Consumer Price Index for All Urban Consumers (C-CPI-U)
increased 0.8 percent in March on a not seasonally adjusted basis. The
March level of 123.204 (December 1999=100) was 3.6 percent higher than in
March 2007. Please note that the indexes for the post-2006 period are
subject to revision.
CPI for All Urban Consumers (CPI-U)
On a seasonally adjusted basis, the CPI-U advanced 0.3 percent in
March, following virtually no change in February. The energy index
increased 1.9 percent in March after declining 0.5 percent in February.
Within energy, the index for petroleum based energy increased 2.0 percent
and the index for energy services rose 1.9 percent. The food index, which
rose 0.4 percent in February, increased 0.2 percent in March. The index
for food at home also rose 0.2 percent. The index for all items less food
and energy rose 0.2 percent in March, following virtually no change in
February. A larger increase in the index for household furnishings and
operations and an upturn in the index for airline fares more than offset a
larger decline in the apparel index.
Table A. Percent changes in CPI for All Urban Consumers (CPI-U)
Seasonally adjusted
Expenditure Compound
Category Changes from preceding month annual Un-
rate adjusted
3-mos. 12-mos.
Sep. Oct. Nov. Dec. Jan. Feb. Mar. ended ended
2007 2007 2007 2007 2008 2008 2008 Mar. 2008 Mar. 2008
All items.......... .4 .3 .9 .4 .4 .0 .3 3.1 4.0
Food and beverages .5 .2 .4 .1 .7 .4 .2 5.1 4.4
Housing........... .3 .2 .4 .3 .2 .2 .4 3.4 3.0
Apparel........... .2 .1 .6 .1 .4 -.3 -1.3 -4.7 -1.4
Transportation.... .7 .3 3.5 1.0 .5 -.7 .7 2.4 8.2
Medical care...... .4 .5 .4 .3 .5 .1 .1 3.2 4.6
Recreation........ .2 .3 .2 .0 .2 .1 .3 2.3 1.3
Education and
communication.. .2 .3 .0 .3 .4 .1 .3 3.2 3.0
Other goods and
services....... .3 .2 .2 .3 .4 .2 .4 4.5 3.2
Special indexes:
Energy............ 1.4 1.0 6.9 1.7 .7 -.5 1.9 8.6 17.0
Food.............. .5 .2 .4 .1 .7 .4 .2 5.3 4.5
All items less
food and energy .2 .2 .2 .2 .3 .0 .2 2.0 2.4
For the first three months of 2008, consumer prices increased at a
seasonally adjusted annual rate (SAAR) of 3.1 percent. This compares with
an increase of 4.1 percent for all of 2007. The index for energy, which
rose 17.4 percent in 2007, advanced at a 8.6 percent SAAR in the first
quarter of 2008. Petroleum-based energy costs increased at a 5.6 percent
annual rate and charges for energy services rose at a 12.8 percent annual
rate. The food index rose at a 5.3 percent SAAR in the first quarter of
2008, following a 4.9 percent increase in all of 2007. The index for
grocery store food prices increased at a 5.9 percent annual rate,
reflecting increases in each of the six major groups ranging from annual
rates of 0.7 percent in the index for dairy products to 15.7 percent in
the index for cereal and bakery products.
Excluding food and energy, the CPI-U advanced at a 2.0 percent SAAR
in the first quarter, following a 2.4 percent rise in all of 2007. The
moderation thus far in 2008 largely reflects smaller increases in the
indexes for shelter--up at a 2.0 percent rate after advancing 3.1 percent
in all of 2007--and medical care, coupled with a larger decline in the
index for apparel. The annual rates for selected groups for the last
seven and one-quarter years are shown below.
Percentage change 12 months SAAR 3
ended in December mos.
ended
Mar.
2001 2002 2003 2004 2005 2006 2007 2008
All items........... 1.6 2.4 1.9 3.3 3.4 2.5 4.1 3.1
Food and beverages 2.8 1.5 3.5 2.6 2.3 2.2 4.8 5.1
Housing............ 2.9 2.4 2.2 3.0 4.0 3.3 3.0 3.4
Apparel............ -3.2 -1.8 -2.1 -.2 -1.1 .9 -.3 -4.7
Transportation..... -3.8 3.8 .3 6.5 4.8 1.6 8.3 2.4
Medical care....... 4.7 5.0 3.7 4.2 4.3 3.6 5.2 3.2
Recreation......... 1.5 1.1 1.1 .7 1.1 1.0 .8 2.3
Education and
communication..... 3.2 2.2 1.6 1.5 2.4 2.3 3.0 3.2
Other goods and
services.......... 4.5 3.3 1.5 2.5 3.1 3.0 3.3 4.5
Special indexes:
Energy............. -13.0 10.7 6.9 16.6 17.1 2.9 17.4 8.6
Energy commodities -24.5 23.7 6.9 26.7 16.7 6.1 29.4 5.6
Energy services... -1.5 .4 6.9 6.8 17.6 -.6 3.4 12.8
All items less
energy............ 2.8 1.8 1.5 2.2 2.2 2.5 2.8 2.5
Food.............. 2.8 1.5 3.6 2.7 2.3 2.1 4.9 5.3
All items less food
and energy........ 2.7 1.9 1.1 2.2 2.2 2.6 2.4 2.0
The food and beverages index rose 0.2 percent in March. The index
for grocery store food also increased 0.2 percent. Another large increase
in the index for cereal and bakery products was partially offset by a
downturn in the index for dairy products; the other four major grocery
store food groups registered small increases. The index for cereal and
bakery products, which increased 1.8 percent in February, rose 1.3 percent
in March. Prices for bread increased 2.1 percent in March and were 14.7
percent higher than a year earlier. The index for dairy products declined
0.8 percent in March, as milk prices fell 2.2 percent. Despite the drop
in March, milk prices were still 13.3 percent higher than in March 2007.
The index for fruits and vegetables rose 0.1 percent. A 2.0 percent
increase in the index for fresh vegetables more than offset declines in
the indexes for fresh fruits and for processed fruits and vegetables--down
1.1 and 0.9 percent, respectively. The index for meats, poultry, fish,
and eggs was virtually unchanged in March. Increases in prices for beef,
for poultry, and for other meats were offset by declines in prices for
pork and for fish and seafood. The indexes for nonalcoholic beverages and
for other food at home increased 0.3 and 0.1 percent, respectively. The
other two components of the food and beverages index--food away from home
and alcoholic beverages--increased 0.3 and declined 0.1 percent,
respectively.
The index for housing, which rose 0.2 percent in February, increased
0.4 percent in March. Each of the three major groups contributed to the
larger advance. The index for shelter increased 0.1 percent in March
after registering virtually no change in February. Within shelter, the
indexes for rent and owners' equivalent rent each increased 0.2 percent,
while the index for lodging away from home fell 0.6 percent. (Prior to
seasonal adjustment, the index for lodging away from home increased 3.7
percent.) The index for fuels and utilities increased 2.0 percent,
following a 1.3 percent rise in February. Upturns in the indexes for
electricity and for fuel oil more than offset a smaller increase in
charges for natural gas. The index for natural gas, which rose 7.2
percent in February, increased 4.6 percent in March. The index for fuel
oil increased 10.1 percent in March and is 48.4 percent higher than in
March 2007. The index for electricity rose 0.8 percent. The index for
household furnishings and operations, which was virtually unchanged in
February, increased 0.5 percent in March. About two-thirds of the advance
reflects a 1.7 percent increase in prices for furniture and bedding.
The transportation index increased 0.7 percent in March after
declining 0.7 percent in February, reflecting the upturn in gasoline
prices. The index for motor fuels, which declined 2.0 percent in
February, advanced 1.6 percent in March and accounted for almost three-
fourths of the transportation increase in March. As of March, the price
of gasoline was 4.4 percent higher than its previous peak level recorded
in May 2007. The index for new vehicles declined 0.1 percent in March and
was 1.1 percent lower than in March 2007. The index for used cars and
trucks was virtually unchanged in March. The index for public
transportation advanced 2.5 percent in March, reflecting increases in
airline fares and intercity train fares. Airline fares increased 3.0
percent in March and have risen 10.2 percent in the last 12 months.
The index for apparel fell 1.3 percent in March, following a 0.3
percent decrease in February. (Prior to seasonal adjustment, apparel
prices rose 2.6 percent, reflecting the continued introduction of spring-
summer wear. Prices for women's and girls' apparel registered the largest
advance--up 4.0 percent.)
Medical care costs rose 0.1 percent in March and are 4.6 percent
higher than a year ago. The index for medical care commodities--
prescription drugs, nonprescription drugs, and medical supplies--increased
0.4 percent. The index for medical care services rose 0.1 percent in
March. The indexes for professional services and for hospital and related
services increased 0.1 and 0.2 percent, respectively.
.
The index for recreation, which rose 0.1 percent in February,
advanced 0.3 percent in March. Increases in the indexes for pets, pet
products and services and for admissions to sporting events--each up 1.1--
and for cable and satellite television and radio service--up 0.6 percent--
largely accounted for the March advance.
The index for education and communication rose 0.3 percent in March.
Educational costs increased 0.4 percent and communication costs rose 0.1
percent. Within the latter category, increases in charges for telephone
services more than offset a decline in the index for information
technology, hardware and services. Local-and long distance-land-line
telephone charges rose 0.5 and 0.2 percent, respectively, while charges
for wireless telephone services were unchanged. The index for information
technology, hardware and services declined 0.1 percent, reflecting
decreases in the indexes for personal computers and peripheral equipment,
for computer software and accessories, and for internet services.
The index for other goods and services rose 0.4 percent in March.
The index for personal care rose 0.6 percent, reflecting increases in the
indexes for haircuts, tax return preparation, and miscellaneous personal
goods. These increases were partially offset by a 0.1 percent decline in
the index for tobacco and smoking products.
CPI for Urban Wage Earners and Clerical Workers (CPI-W)
On a seasonally adjusted basis, the CPI for Urban Wage Earners and
Clerical Workers rose 0.4 percent in March.
Table B. Percent changes in CPI for Urban Wage Earners and
Clerical Workers (CPI-W)
Seasonally adjusted
Expenditure Compound
Category Changes from preceding month annual Un-
rate adjusted
3-mos. 12-mos.
Sep. Oct. Nov. Dec. Jan. Feb. Mar. ended ended
2007 2007 2007 2007 2008 2008 2008 Mar. 2008 Mar. 2008
All items.......... .4 .3 1.0 .4 .4 .0 .4 3.3 4.3
Food and beverages .5 .2 .3 .1 .7 .3 .2 5.1 4.4
Housing........... .2 .3 .4 .2 .2 .2 .5 3.6 3.0
Apparel........... .0 .1 .4 .2 .8 -.3 -1.2 -3.1 -1.0
Transportation.... .7 .3 3.8 1.1 .7 -.7 .7 2.8 9.0
Medical care...... .4 .5 .4 .3 .6 .1 .1 3.2 4.6
Recreation........ .3 .2 .1 .1 .2 .1 .3 2.5 1.2
Education and
communication.. .1 .3 .0 .2 .3 .1 .2 2.6 2.6
Other goods and
services....... .4 .2 .2 .4 .5 .3 .4 4.8 3.4
Special indexes:
Energy............ 1.4 1.1 7.2 1.8 .8 -.7 1.9 8.3 17.6
Food.............. .5 .2 .3 .1 .7 .3 .2 5.2 4.5
All items less
food and energy .2 .2 .2 .2 .3 .0 .1 2.1 2.3
Consumer Price Index data for April are scheduled for release on
Wednesday, May 14, 2008, at 8:30 A.M. (EDT).
Facilities for Sensory Impaired
Information from this release will be made available to sensory
impaired individuals upon request. Voice phone: 202-691-5200, Federal
Relay Services: 1-800-877-8339. For a recorded message of Summary CPI
data, call (202) 691-5200.
Brief Explanation of the CPI
The Consumer Price Index (CPI) is a measure of the average change in
prices over time of goods and services purchased by households. The
Bureau of Labor Statistics publishes CPIs for two population groups: (1)
the CPI for Urban Wage Earners and Clerical Workers (CPI-W), which covers
households of wage earners and clerical workers that comprise
approximately 32 percent of the total population and (2) the CPI for All
Urban Consumers (CPI-U) and the Chained CPI for All Urban Consumers (C-CPI-
U), which cover approximately 87 percent of the total population and
include in addition to wage earners and clerical worker households, 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 CPIs are based on prices of food, clothing, shelter, and fuels,
transportation fares, charges for doctors' and dentists' services, drugs,
and 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
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 or
telephone calls of the Bureau's trained representatives.
In calculating the index, price changes for the various items in each
location are averaged together with weights, which represent their
importance in the spending of the appropriate population group. Local
data are then combined to obtain a U.S. city average. For the CPI-U and
CPI-W 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. For the C-CPI-U data are
issued only at the national level. It is important to note that the CPI-U
and CPI-W are considered final when released, but the C-CPI-U is issued in
preliminary form and subject to two annual revisions.
The index measures price change from a designed reference date. For
the CPI-U and the CPI-W the reference base is 1982-84 equals 100.0. The
reference base for the C-CPI-U is December 1999 equals 100.
An increase of 16.5 percent from the reference base, 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 visit the CPI home page on the Internet at
http://www.bls.gov/cpi/ or contact our CPI Information and Analysis
Section on (202) 691-7000.
Note on Sampling Error in the Consumer Price Index
The CPI is a statistical estimate that is subject to sampling error
because it is based upon a sample of retail prices and not the complete
universe of all prices. BLS calculates and publishes estimates of the 1-
month, 2-month, 6-month and 12-month percent change standard errors
annually, for the CPI-U. These standard error estimates can be used to
construct confidence intervals for hypothesis testing. For example, the
estimated standard error of the 1 month percent change is 0.06 percent for
the U.S. All Items Consumer Price Index. This means that if we repeatedly
sample from the universe of all retail prices using the same methodology,
and estimate a percentage change for each sample, then 95% of these
estimates would be within 0.12 percent of the 1 month percentage change
based on all retail prices. For a 1-month change of 0.2 percent in the
All Items CPI for All Urban Consumers, we are 95 percent confident that
the actual percent change based on all retail prices would fall between
0.08 and 0.32 percent. For the latest data, including information on how
to use the estimates of standard error, see "Variance Estimates for
Changes in the Consumer Price Index, January 2005- December 2005 in the
CPI Detailed Report, February 2006. These data are available on the CPI
home page (http://www.bls.gov/cpi), using the following link
http://www.bls.gov/cpi/cpivar2006.pdf
Calculating Index Changes
Movements of the indexes from one month to another are usually
expressed as percent changes rather than changes in index points, because
index point changes are affected by the level of the index in relation to
its
base period while percent changes are not. The example below illustrates
the computation of index point and percent changes.
Percent changes for 3-month and 6-month periods are expressed as
annual rates and are computed according to the standard formula for
compound growth rates. These data indicate what the percent change would
be if the current rate were maintained for a 12-month period.
Index Point Change
CPI
202.416
Less previous index
201.800
Equals index point change
.616
Percent Change
Index point difference
.616
Divided by the previous index
201.800
Equals
0.003
Results multiplied by one hundred
0.003x100
Equals percent change
0.3
Regions Defined
The states in the four regions shown in Tables 3 and 6 are listed below.
The Northeast--Connecticut, Maine, Massachusetts, New Hampshire, New York,
New Jersey, Pennsylvania, Rhode Island, and Vermont.
The Midwest--Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota,
Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin.
The South--Alabama, Arkansas, Delaware, Florida, Georgia, Kentucky,
Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South
Carolina, Tennessee, Texas, Virginia, West Virginia, and the District of
Columbia.
The West--Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana,
Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming.
A Note on Seasonally Adjusted and Unadjusted Data
Because price data are used for different purposes by different
groups, the Bureau of Labor Statistics publishes seasonally adjusted as
well as unadjusted changes each month.
For analyzing general price trends in the economy, seasonally
adjusted changes are usually preferred since they eliminate the effect of
changes that normally occur at the same time and in about the same
magnitude every year--such as price movements resulting from changing
climatic conditions, production cycles, model changeovers, holidays, and
sales.
The unadjusted data are of primary interest to consumers concerned
about the prices they actually pay. Unadjusted data also are used
extensively for escalation purposes. Many collective bargaining contract
agreements and pension plans, for example, tie compensation changes to the
Consumer Price Index before adjustment for seasonal variation.
Seasonal factors used in computing the seasonally adjusted indexes
are derived by the X-12-ARIMA Seasonal Adjustment Method. Seasonally
adjusted indexes and seasonal factors are computed annually. Each year,
the last 5 years of seasonally adjusted data are revised. Data from
January 2003 through December 2007 were replaced in January 2008.
Exceptions to the usual revision schedule were: the updated seasonal data
at the end of 1977 replaced data from 1967 through 1977; and, in January
2002, dependently seasonally adjusted series were revised for January 1987-
December 2001 as a result of a change in the aggregation weights for
dependently adjusted series. For further information, please see
"Aggregation of Dependently Adjusted Seasonally Adjusted Series," in the
October 2001 issue of the CPI Detailed Report.
The seasonal movement of All items and 54 other aggregations is
derived by combining the seasonal movement of 73 selected components.
Each year the seasonal status of every series is reevaluated based upon
certain statistical criteria. If any of the 73 components change their
seasonal adjustment status from seasonally adjusted to not seasonally
adjusted, not seasonally adjusted data will be used in the aggregation of
the dependent series for the last 5 years, but the seasonally adjusted
indexes will be used before that period. Note: 48 of the 73 components
are seasonally adjusted for 2008.
Seasonally adjusted data, including the All items index levels, are
subject to revision for up to five years after their original release.
For this reason, BLS advises against the use of these data in escalation
agreements.
Effective with the calculation of the seasonal factors for 1990, the
Bureau of Labor Statistics has used an enhanced seasonal adjustment
procedure called Intervention Analysis Seasonal Adjustment for some CPI
series. Intervention Analysis Seasonal Adjustment allows for better
estimates of seasonally adjusted data. Extreme values and/or sharp
movements which might distort the seasonal pattern are estimated and
removed from the data prior to calculation of seasonal factors. Beginning
with the calculation of seasonal factors for 1996, X-12-ARIMA software was
used for Intervention Analysis Seasonal Adjustment.
For the seasonal factors introduced in January 2008, BLS adjusted 20
series using Intervention Analysis Seasonal Adjustment, including selected
food and beverage items, motor fuels, electricity and vehicles. For
example, this procedure was used for the Motor fuel series to offset the
effects of events such as damage to oil refineries from Hurricane Katrina.
For a complete list of Intervention Analysis Seasonal Adjustment
series and explanations, please refer to the article "Intervention
Analysis Seasonal Adjustment", located on our website at
http://www.bls.gov/cpi/cpisapage.htm.
For additional information on seasonal adjustment in the CPI, please
write to the Bureau of Labor Statistics, Division of Consumer Prices and
Price Indexes, Washington, DC 20212 or contact Jeff Wilson at (202) 691-
6968, or by e-mail at Wilson.Jeff@bls.gov. If you have general questions
about the CPI, please call our information staff at (202) 691-7000.
.
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