Consumer Price Index, Minneapolis-St. Paul, Minn.-Wis., MSA – 2012 Annual Averages

The Consumer Price Index for All Urban Consumers (CPI-U) in the Minneapolis-St. Paul area rose 2.3 percent from 2011 to 2012, the U.S. Bureau of Labor Statistics reported today. Regional Commissioner Charlene Peiffer noted that the energy index fell 2.3 percent in 2012, primarily due to falling prices for utility (piped) gas service. Food prices were up 2.8 percent. The index for all items less food and energy increased 2.8 percent. Within the all items less food and energy category, the indexes for shelter, medical care, and education and communication were higher over the year.

Food

Average annual food prices rose 2.8 percent in 2012 after rising 4.9 percent in 2011. Between the two components of the food index, prices for food at home increased 3.0 percent and the food away from home index rose 2.5 percent.

Energy

The energy index fell 2.3 percent in 2012 after rising 17.1 percent in 2011. Within the energy category, the index for utility (piped) gas service fell 16.8 percent and the index for gasoline fell 0.7 percent. Electricity prices were 1.2 percent higher compared to their 2011 averages.

All items less food and energy

Over the year, the annual average index for all items less food and energy increased 2.8 percent. Among the index’s components, higher costs were recorded for shelter (2.1 percent), medical care (5.0 percent), and education and communication (2.5 percent).

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The first half 2013 Consumer Price Index for Milwaukee-Racine is scheduled to be released on August 15, 2013, at 7:30 a.m. (CT).

Technical Note

The Consumer Price Index (CPI) is a measure of the average change in prices over time in a fixed market basket of goods and services. The Bureau of Labor Statistics publishes CPIs for two population groups: (1) a CPI for All Urban Consumers (CPI-U) which covers approximately 88 percent of the total population and (2) a CPI for Urban Wage Earners and Clerical Workers (CPI-W) which covers 29 percent of the total population. The CPI-U includes, in addition to wage earners and clerical workers, 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 CPI is based on prices of food, clothing, shelter, and fuels, transportation fares, charges for doctors' and dentists' services, drugs, and the other goods and services that people buy for day-to-day living. Each month, prices are collected in 87 urban areas across the country from about 4,000 housing units and approximately 26,000 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.

The index measures price changes from a designated reference date (1982-84) that equals 100.0. An increase of 16.5 percent, 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 see the CPI home page on the Internet at www.bls.gov/cpi and the BLS Handbook of Methods, Chapter 17, The Consumer Price Index, available on the Internet at www.bls.gov/opub/hom/homch17_a.htm.

In calculating the index, price changes for the various items in each location are averaged together with weights that represent their importance in the spending of the appropriate population group. Local data are then combined to obtain a U.S. city average. Because the sample size of a local area is smaller, the local area index is subject to substantially more sampling and other measurement error than the national index. In addition, local indexes are not adjusted for seasonal influences. As a result, local area indexes show greater volatility than the national index, although their long-term trends are quite similar. NOTE: Area indexes do not measure differences in the level of prices between cities; they only measure the average change in prices for each area since the base period.

The Minneapolis-St. Paul, Minn.-Wis. metropolitan are covered in this release is comprised of Anoka, Carver, Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, and Wright Counties and Pierce and St. Croix Counties in Wisconsin.

Information in this release will be made available to sensory impaired individuals upon request. Voice phone: (202) 691-5200: Federal Relay Service: (800) 877-8339.