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To: Haim R. Branisteanu who wrote (42154)	3/3/2000 10:18:00 PM
From: Haim R. Branisteanu	Respond to of 99985

Consumer Price Index Summary (the fine print which counts see below) Friday, February 18, 2000 stats.bls.gov CONSUMER PRICE INDEX: JANUARY 2000 The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in January, before seasonal adjustment, to a level of 168.7 (1982-84=100), the Bureau of Labor Statistics of the U.S. Department of Labor reported today. For the 12-month period ended in January, the CPI-U increased 2.7 percent. Table B. Percent changes in CPI for Urban Wage Earners and Clerical Workers (CPI-W) Seasonally adjusted Un- Compound adjusted Expenditure Changes from preceding month annual rate 12-mos. Category 1999 2000 3-mos. ended ended July Aug. Sep. Oct. Nov. Dec. Jan. Jan.'00 Jan.'00 All Items .4 .2 .5 .2 .2 .2 .2 2.4 2.8 Food and beverages .1 .2 .2 .3 .2 .1 -.1 1.0 1.7 Housing .2 .2 .3 .1 .3 .1 .2 2.5 2.3 Apparel -.7 -.3 .9 .4 -.3 .1 -1.0 -4.8 -.9 Transportation 1.1 1.0 .8 .1 .1 .9 .2 4.7 6.2 Medical care .3 .3 .4 .2 .3 .3 .3 3.7 3.5 Recreation .0 -.1 -.4 .1 .0 .2 .2 1.6 .2 Education and communication .2 .2 .0 .3 .3 .2 .6 4.4 1.8 Other goods and services 1.3 -.5 2.5 .2 -.2 .0 .7 2.1 3.9 Special indexes Energy 1.9 2.7 1.9 -.2 .2 2.1 1.0 13.7 16.0 Food .1 .2 .3 .2 .2 .1 -.1 1.0 1.6 All items less food and energy .2 .1 .4 .2 .2 .1 .1 1.6 1.9 Consumer Price Index data for February are scheduled for release on Friday, March 17, 2000, at 8:30 A.M. (EST). ___________________________________________________________________ __________________________________________________________ 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 unadjusted for seasonal variation. Seasonal factors used in computing the seasonally adjusted indexes are derived by the X-12-ARIMA Seasonal Adjustment Method. The updated seasonal data at the end of 1977 replaced data from 1967 through 1977. Subsequent annual updates have replaced 5 years of seasonal data, e.g., data from 1995 through 1999 were replaced at the end of 1999. 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 for the last 5 years, but the seasonally adjusted indexes will be used before that period. 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 fuel oil and the motor fuels indexes, this procedure was used to offset the effects that extreme price volatility would otherwise have had on the estimates of seasonally adjusted data for those series. For the breakfast cereal index, the procedure was used to offset the effects of price-cutting among cereal manufacturers. For the educational books and supplies index, the procedure was used to account for greater than normal sale prices on educational reference books. For some alcoholic beverage series, Intervention Analysis Seasonal Adjustment was used to offset the effects of increased brewer's costs along with increased demand for specialty beers. For the nonalcoholic beverages index, the procedure was used to offset the effects of a large increase in coffee prices due to adverse weather. For the fats and oils series, the procedure was used to account for lower domestic butter stocks, lower cold storage supplies, and anticipation of a bumper soybean crop. For the new trucks index, the procedure was applied to account for loyalty rebates offered to customers by American automakers. For the water and sewerage maintenance index, the procedure was used to account for a data collection anomaly. A description of Intervention Analysis Seasonal Adjustment, as well as a list of unusual events modeled and seasonal factors for these items may be obtained by writing the Bureau of Labor Statistics, Division of Consumer Prices and Price Indexes, Washington, DC 20212 or by calling Claire McAnaw Gallagher on (202) 691-6968 or sending e-mail to Gallagher_C@BLS.GOV.