April 2017 Consumer Price Index

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The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in April on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index rose 2.2 percent before seasonal adjustment.

Increases in indexes for shelter, energy, tobacco, and food all contributed to the monthly increase in the all items index. The energy index rose 1.1 percent, with all 3 of its major component indexes rising. The food index rose 0.2 percent, mostly due to a sharp increase in the index for fresh vegetables.

The index for all items less food and energy rose 0.1 percent in April after declining in March. The shelter index increased 0.3 percent, and the tobacco index increased sharply over the month. However, many indexes declined in April, including those for wireless phone services, medical care, motor vehicle insurance, apparel, used cars and trucks, recreation, and new vehicles.

The all items index rose 2.2 percent for the 12 months ending April. While a smaller increase than the 2.4 percent rise for the 12 months ending March, this is still a larger rise than the 1.7 percent average annual increase over the past 10 years. The index for all items less food and energy rose 1.9 percent over the last 12 months; this compares to a 1.8 percent average annual increase over the past decade. The energy index rose 9.3 percent over the last year, while the food index increased 0.5 percent.

Seasonally adjusted changes from preceding month Un- adjusted 12-mos. Oct. Nov. Dec. Jan. Feb. Mar. Apr. ended 2016 2016 2016 2017 2017 2017 2017 Apr. 2017

Food

The food index rose 0.2 percent in April, its fourth consecutive increase. The index for food at home advanced 0.2 percent, following a 0.5-percent increase in March. The index for fruits and vegetables rose 2.2 percent as the index for fresh vegetables increased 5.1 percent, its largest increase since February 2011.

Four of the five remaining major grocery store food group indexes declined in April. The index for meats, poultry, fish, and eggs fell 0.6 percent after rising in each of the 3 previous months. The cereals and bakery products index fell 0.3 percent, as did the index for nonalcoholic beverages. The dairy index fell 0.2 percent in April after a 0.6 percent decline in March. The index for other food at home rose slightly in April, increasing 0.1 percent.

The food at home index fell 0.8 percent over the past year as 5 of the 6 major grocery store food group indexes declined. The exception was the fruits and vegetables index, which rose 0.7 percent. The index for meats, poultry, fish, and eggs decreased 3.0 percent over the last year, and the remaining groups posted smaller declines. The index for food away from home advanced 0.2 percent in April, and rose 2.3 percent over the last 12 months.

Energy

The energy index increased 1.1 percent in April following declines in February and March. All of the major energy component indexes increased in April after falling in March. The gasoline index, which fell 6.2 percent in March, increased 1.2 percent in April. (Before seasonal adjustment, gasoline prices increased 4.0 percent in April.) The index for natural gas rose 2.2 percent, and the electricity index increased 0.6 percent over the month.

All of the energy component indexes increased over the last year. The gasoline index rose 14.3 percent, and the index for natural gas increased 12.0 percent. The electricity index advanced more modestly, rising 2.4 percent.

All items less food and energy

The index for all items less food and energy increased 0.1 percent in April after declining in March. The shelter index rose 0.3 percent. The rent index increased 0.3 percent, and the index for owners' equivalent rent advanced 0.2 percent. The index for lodging away from home rose 2.1 percent after declining 2.4 percent in March. The tobacco index rose 4.2 percent in April, its largest increase since April 2009. The indexes for alcoholic beverages, education, and personal care also increased in April.

Several indexes posted declines in April. The index for communication fell 0.6 percent as the index for wireless telephone services continued to fall, decreasing 1.7 percent in April after a 7.0-percent decline in March. The medical care index fell 0.2 percent in April, with medical care component indexes mixed. The physicians' services index fell 1.2 percent, and the index for prescription drugs declined 0.9 percent, but the hospital services index rose 1.0 percent.

The index for motor vehicle insurance fell 0.4 percent in April, ending a streak of 17 consecutive monthly increases. The index for used cars and trucks fell 0.5 percent in April, its fourth consecutive decline, and the new vehicles index decreased 0.2 percent. The apparel index fell 0.3 percent, and the indexes for recreation, household furnishings and operations, and airline fares also declined.

The index for all items less food and energy rose 1.9 percent over the past 12 months; this was the first 12-month increase below 2.0 percent since the period ending October 2015. The shelter index rose 3.5 percent over the year, and the index for medical care rose 3.0 percent. The education index, which has been increasing more slowly recently than it typically has in the past, rose 2.4 percent over the last 12 months. The index for communication fell 6.5 percent over the past year, the largest decline since the inception of the index in 1993; the index for wireless phone services declined 12.9 percent over the year.

Not seasonally adjusted CPI measures

The Consumer Price Index for All Urban Consumers (CPI-U) increased 2.2 percent over the last 12 months to an index level of 244.524 (1982-84=100). For the month, the index rose 0.3 percent prior to seasonal adjustment.

The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 2.1 percent over the last 12 months to an index level of 238.432 (1982-84=100). For the month, the index increased 0.3 percent prior to seasonal adjustment.

The Chained Consumer Price Index for All Urban Consumers (C-CPI-U) increased 2.1 percent over the last 12 months. For the month, the index rose 0.3 percent on a not seasonally adjusted basis. Please note that the indexes for the past 10 to 12 months are subject to revision.

Consumer Price Index Geographic Revision for 2018

In January 2018, BLS will introduce a new geographic area sample for the Consumer Price Index (CPI). The 2018 revision utilizes the 2010 Decennial Census and incorporates an updated area sample design, changes the frequency of publication for several local area indexes, and establishes some new local area and aggregate indexes. The first indexes using the new structure will be published in February 2018. Additional information on the geographic revision is available at: www.bls.gov/cpi/georevision2018.htm.

A Note on the Use of Seasonally Adjusted and Unadjusted Data

Introduction

The Consumer Price Index (CPI) produces both unadjusted and seasonally adjusted data. Seasonally adjusted data are computed using seasonal factors derived by the X-13ARIMA-SEATS Seasonal Adjustment Method. These factors are updated each February, and the new factors are used to revise the previous five years of seasonally adjusted data. For more information on data revisions and exceptions to the usual revision schedule, please see the Fact Sheet on Seasonal Adjustment (https://www.bls.gov/cpi/cpisaqanda.htm) and the Timeline of Seasonal Adjustment Methodological Changes (https://www.bls.gov/cpi/cpiseastimeline.htm).

How to Use Seasonally Adjusted and Unadjusted Data

For analyzing short-term 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. This allows data users to focus on changes that are not typical for the time of year.The unadjusted data are of primary interest to consumers concerned about the prices they actually pay. Unadjusted data are also 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. BLS advises against the use of seasonally adjusted data in escalation agreements because seasonally adjusted series are revised annually.

Intervention Analysis

The Bureau of Labor Statistics uses Intervention Analysis Seasonal Adjustment for some CPI series. Sometimes extreme values or sharp movements can distort the underlying seasonal pattern of price change. Intervention Analysis Seasonal Adjustment is a process by which the distortions caused by such unusual events are estimated and removed from the data prior to calculation of seasonal factors. The resulting seasonal factors, which more accurately represent the seasonal pattern, are then applied to the unadjusted data.

2017 Series Adjusted Using Intervention Analysis Seasonal Adjustment

For the seasonal factors introduced in January 2017, BLS adjusted 40 series using Intervention Analysis Seasonal Adjustment, including selected food and beverage items, motor fuels and natural gas. For example, this procedure was used for the Motor fuel series to offset the effects of events such as the 2009 return to normal pricing after the worldwide economic downturn in 2008.

Revision of Seasonally Adjusted Indexes

Seasonally adjusted data, including the U.S. city average All items index levels, are subject to revision for up to five years after their original release. Every year, economists in the CPI calculate new seasonal factors for seasonally adjusted series and apply them to the last five years of data. Seasonally adjusted indexes beyond the last five years of data are considered to be final and not subject to revision. In January 2017, revised seasonal factors and seasonally adjusted indexes for 2012-2016 were calculated and published. For directly adjusted series, the seasonal factors for 2016 will be applied to data in 2017 to produce the seasonally adjusted 2017 indexes.

Determining Seasonal Status

Each year the seasonal status of every series is reevaluated based upon certain statistical criteria. Using these criteria, BLS economists determine whether a series should change its status: from "not seasonally adjusted" to "seasonally adjusted", or vice versa. If any of the 81 components of the U.S. city average all items index 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 five years, but the seasonally adjusted indexes before that period will not be changed. 27 of the 81 components of the U.S. city average all items index are not seasonally adjusted for 2017.

Contact Information

For additional information on seasonal adjustment in the CPI, please contact us at (202)691-6968 or cpiseas@bls.gov. If you have general questions about the CPI, please call our information staff at (202) 691-7000 or cpi_info@bls.gov.

Facilities for Sensory Impaired

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