February 2007 Consumer Price Index

Historical release narrative reproduced from the official public-domain source. Statistical tables, standard technical appendices, administrative material and attendance rosters are omitted; formatting is adapted for reading. Figures retain the release's historical context and may have been revised. Consult the linked source for the complete document.

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.5 percent in February, before seasonal adjustment, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. The February level of 203.499 (1982-84=100) was 2.4 percent higher than in February 2006.

The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 0.5 percent in February, prior to seasonal adjustment. The February level of 198.544 (1982-84=100) was 2.2 percent higher than in February 2006.

The Chained Consumer Price Index for All Urban Consumers (C-CPI-U) increased 0.5 percent in February on a not seasonally adjusted basis. The February level of 118.021 (December 1999=100) was 2.2 percent higher than in February 2006. Please note that the indexes for the post-2005 period are subject to revision.

CPI for All Urban Consumers (CPI-U)

On a seasonally adjusted basis, the CPI-U advanced 0.4 percent in February, following a 0.2 percent increase in January. Energy costs increased 0.9 percent in February after declining 1.5 percent in January. In February, the index for petroleum-based energy increased 0.3 percent and the index for energy services rose 1.5 percent. The food index rose 0.8 percent in February, following a 0.7 percent increase in January. Grocery store foods rose 1.1 percent, largely reflecting a 4.7 percent increase in the index for fruits and vegetables. The index for all items less food and energy advanced 0.2 percent in February, following a 0.3 percent rise in January; an increase in the index for shelter accounted for about one-half of the February advance.

The food and beverages index rose 0.8 percent in February. The index for food at home increased 1.1 percent, following a 0.9 percent increase in January. Over three-fifths of the February advance was attributable to a 4.7 percent increase in the index for fruits and vegetables. Anticipated smaller citrus crops for the 2006-07- season were exacerbated by adverse weather conditions in January on the West coast, resulting in sharply higher citrus prices--up 16.3 percent in February. Overall, the indexes for fresh fruits and for fresh vegetables each increased 5.7 percent, and the index for processed fruits and vegetables rose 0.6 percent. Breakfast cereal prices rose 3.3 percent in February after declining 2.4 percent in January, largely accounting for the 1.1 percent increase in the index for cereal and bakery products. The index for meats, poultry, fish, and eggs, which advanced 0.8 percent in January, increased 0.4 in February. Beef prices increased 1.3 percent, while the indexes for pork and for other meats declined 0.6 and 2.9 percent, respectively. Prices for poultry products rose 0.8 percent and prices for fish and seafood increased 0.4 percent. The index for eggs rose sharply for the fourth consecutive month--up 8.0 percent in February and has advanced 29.1 percent in the last 12 months. The index for other food at home increased 0.3 percent and the indexes for dairy products and for nonalcoholic beverages each rose 0.2 percent. The other two components of the food and beverages index--food away from home and alcoholic beverages- -increased 0.4 and 0.7 percent, respectively.

The index for housing rose 0.4 percent in February, following a 0.2 percent increase in January. The index for fuels and utilities, which rose 0.3 percent in January, increased 1.2 percent in February, reflecting upturns in the indexes for fuel oil and for natural gas. The index for fuel oil rose 0.5 percent in February, following a 5.6 percent decline in January. The index for natural gas, which declined 3.0 percent in January, advanced 5.0 percent in February. Charges for electricity were virtually unchanged in February after advancing 2.0 percent in January. The index for shelter increased 0.3 percent in February, the same as in each of the preceding two months. Within shelter, the index for rent rose 0.4 percent; owners' equivalent rent increased 0.3 percent; and the index for lodging away from home rose 0.1 percent. (Prior to seasonal adjustment, the index for lodging away from home increased 4.1 percent.) The index for household furnishings and operations, which declined 0.3 percent in January, rose 0.2 percent in February.

The transportation index rose 0.1 percent in February, following a 0.8 percent decrease in January. The index for gasoline prices, which declined 3.0 percent in January, rose 0.3 percent in February. Gasoline prices were 1.4 percent lower than a year ago and 23.7 percent lower than their peak level recorded in July 2006. The index for new vehicles declined 0.1 percent in February and was 1.4 percent lower than in February 2006. (As of February, about 88 percent of the new vehicle sample was represented by 2007 models. The 2007 models will continue to be phased in, with appropriate adjustments for quality change, over the next several months as they replace old models at dealerships.) The index for used cars and trucks decreased 0.5 percent in February. The index for public transportation rose 0.3 percent in January, reflecting a 0.9 percent increase in the index for airline fares.

The index for apparel rose 0.5 percent in February, following a 0.3 percent increase in January. (Prior to seasonal adjustment, apparel prices rose 2.6 percent, reflecting the introduction of spring-summer wear. Prices for women's apparel registered the largest advance--up 4.9 percent.)

Medical care costs rose 0.5 percent in February and are 4.3 percent higher than a year ago. The index for medical care commodities-- prescription drugs, nonprescription drugs, and medical supplies--decreased 0.3 percent. The index for medical care services advanced 0.7 percent. The indexes for professional services and for hospital and related services increased 0.7 and 0.6 percent, respectively.

The index for recreation was virtually unchanged in February. Increases in the indexes for pets, pet products and services and for recreational reading materials--up 0.8 and 0.3 percent, respectively-- offset declines in the indexes for video and audio, for sporting goods, for photography, and for toys.

The index for education and communication increased 0.3 percent in February. Educational costs increased 0.6 percent and communication costs rose 0.1 percent. Within the communication group, the index for information and information processing rose 0.1 percent as a 0.2 percent increase in telephone services more than offset small decreases in the indexes for personal computers and peripheral equipment, for computer software and accessories and for internet services and electronic information providers.

The index for other goods and services increased 0.2 percent in February. The index for tobacco and smoking products registered its third consecutive large advance--up 1.0 percent in February--and accounted for virtually all of the increase in this major group.

CPI for Urban Wage Earners and Clerical Workers (CPI-W)

On a seasonally adjusted basis, the CPI for Urban Wage Earners and Clerical Workers increased 0.4 percent in February.

Consumer Price Index data for March are scheduled for release on Tuesday, April 17, 2007, at 8:30 A.M. (EDT).

Consumer Price Index Levels to Three Decimal Places

Effective with this release of the Consumer Price Index (CPI), the Bureau of Labor Statistics has begun computing percent changes based upon three decimal place indexes rather than one decimal place indexes. This change applies to the All Items Consumer Price Index and all component indexes for the CPI-U, CPI-W, and C-CPI-U, for the U.S. City Average and for all other published areas. In addition, CPI index values are displayed to three decimal places in all paper and electronic publications. As in the past, percent changes are rounded to one decimal place.

This change in procedure addresses a rounding issue that has resulted in published percent changes that are 0.1 percentage point higher or lower than the same percent changes based on unrounded index values (i.e., indexes to three or more decimal places). These differences can be particularly important when percent changes are very small. Publishing the index values to three decimal places, and using these values to compute percent changes, essentially eliminates the rounding differences. This change only affects the presentation of the index data. Index values continue to be calculated from underlying price data in the same manner as in the past, and no systematic upward or downward effect on the data is introduced. The levels of future indexes will be affected only in that they will be published to three decimal places rather than one. Official CPI data previously published will not be revised.

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

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.