PHILADELPHIA AREA CONSUMER PRICE INDEX: DECEMBER 2009 (PDF)

Retail prices in the Philadelphia area, as measured by the Consumer Price Index for All Urban Consumers (CPI-U), were unchanged from October to December, following a 0.6-percent decrease in the previous two-month period, the U.S. Bureau of Labor Statistics reported today. Lower prices for apparel, medical care, recreation, and education and communication were offset by higher prices for transportation, food and beverages, and other goods and services. The housing index was unchanged since October. (See chart 1.) Sheila Watkins, the Bureau's regional commissioner, noted that the local CPI rose 3.0 percent since last December—the first 12-month increase since October 2008. Over the year, the core inflation rate, as measured by the all items less food and energy index, rose 2.5 percent. (See table 1.)

Chart 1. 2-month and 12-month percent changes ended December 2009 for the major categories of the CPI-U for the Philadelphia area, not seasonally adjusted

Chart Data

Following normal seasonal patterns, apparel prices fell 7.4 percent from October to December. Over the year, apparel prices jumped 10.0 percent—the largest 12-month increase since July 1992.

The medical care index fell 1.1 percent over the last two months—the largest two-month decrease since January 1990. Due to declines in the last three bimonthly periods, the medical care index fell 0.9 percent over the year—the first 12-month decline since the inception of the index in January 1947.

Recreation prices decreased 1.7 percent over the last two months. Over the year, recreation prices fell 1.4 percent.

The education and communication index declined 1.1 percent since October after falling 1.0 percent in the previous bimonthly period. Since December 2008, the education and communication index increased 0.4 percent.

The housing index was unchanged from October to December as a decline in the shelter component was offset by increases in the fuels and utilities and household furnishings and operations components. Shelter prices edged down 0.3 percent since October but were 2.3 percent higher than their year-ago levels. Prices for fuels and utilities rose 1.6 percent over the last two months due to price increases for both utility (piped) gas service (2.1 percent), and electricity (0.4 percent). Over the year, the utility (piped) gas service index dropped 16.0 percent, while the electricity index increased 1.6 percent. The fuels and utilities index fell 1.0 percent over the last 12 months. The household furnishings and operations index edged up 0.2 percent since October but were 2.1 percent lower since December 2008. The overall housing index advanced 1.5 percent over the year.

The remaining categories had higher prices from October to December. The transportation index increased 1.9 percent since October due to a 3.8-percent advance in gasoline prices. Since December 2008, gasoline prices jumped 42.4 percent—the largest 12-month advance since September 2005. The transportation index rose 12.5 percent from its year-ago level.

Following three consecutive bimonthly declines totaling 1.7 percent, the food and beverages index advanced 1.4 percent since October. Prices for food at home rose 2.2 percent over the last two months; higher prices for food away from home and alcoholic beverages, up 0.5 percent each, also contributed to the recent two-month increase in the food and beverages index. Over the last 12 months, food at home prices fell 1.2 percent, while prices for food away from home increased 2.0 percent and those for alcoholic beverages rose 1.8 percent. Over the year, the food and beverages index edged up 0.3 percent.

The other goods and services index rose 1.8 percent from October to December. Since December 2008, the other goods and services index, which includes tobacco and smoking products, personal care products, personal care services, and miscellaneous personal services such as legal, funeral, and laundry and dry cleaning services, advanced 8.3 percent—the largest 12-month increase since June 1999.

The energy index, which reflects prices for gasoline and household fuels, rose 2.7 percent since October. Contributing to the two-month advance were higher prices for gasoline (3.8 percent), utility (piped) gas service (2.1 percent), and electricity (0.4 percent). Energy prices were 11.7 percent higher over the year.

Over the last two months, the services index edged down 0.3 percent, while the commodities index increased 0.5 percent. Since December 2008, prices rose for both services and commodities, up 1.5 and 5.8 percent, respectively.

The CPI-U for the Philadelphia area stood at 224.800 on the 1982-84=100 reference base, which means that a market basket of goods and services which averaged $100.00 in 1982-84 would have cost $224.80 in December 2009.

The Philadelphia-Wilmington-Atlantic City, Pa.-N.J.-Del.-Md., Consolidated Metropolitan Statistical Area (CMSA) includes Bucks, Chester, Delaware, Montgomery, and Philadelphia Counties in Pennsylvania; Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, and Salem Counties in New Jersey; New Castle County in Delaware; and Cecil County in Maryland.

The relative importance of a component of the CPI is its expenditure or value weight expressed as a percentage of all items within an area. Relative importance ratios show approximately how the index population distributes expenditures when the value weights are collected and represent an estimate of how consumers would distribute their expenditures as prices change over time. Relative importance ratios cannot be used as estimates of current spending patterns or as indicators of changing consumer expenditures in the intervals between weight revisions because consumption patterns are influenced by factors—including income, variations in climate, family size, and availability of new and different kinds of goods and services—other than price change. (See table A.)