The average cost of a market basket of goods and services in the United States rose 0.2 percent in January, led by rising energy costs, according to the U.S. Bureau of Labor Statistic's Consumer Price Index (CPI). This is the fourth straight month that the cost of energy has been the major factor in the CPI, though previously they led the index downward. January's index of 177.1 was 1.1 percent higher than the January 2001 index of 175.1. However, the annual inflation rate has declined or stayed constant for eight consecutive months after a recent peak in May 2001 at 3.6%.
The overall index for energy costs jumped 0.9 percent in January from December, due primarily to the return of rising prices at the gasoline pump. Other categories that saw increases were food and beverages (+ 0.3 percent), housing (+ 0.2 percent), transportation (+ 0.3 percent), medical care (+ 0.5 percent), recreation (+ 0.2 percent), education and communication (+ 0.3 percent), and other goods and services (+ 0.3 percent). Only the cost of apparel decreased in January (- 0.7 percent).
The CPI is based on prices of food, clothing, shelter, fuels, transportation fares, charges for doctors' and dentists' services, drugs, and other goods and services that people buy for day-to-day living. Prices are collected in 87 urban areas across the country (including Kansas City and St. Louis) from about 50,000 housing units and approximately 23,000 stores, hospitals, and other types of service establishments.
The actual index is expressed as a number derived by comparing the current cost of goods and services to the cost of the same items between 1982-1984. The reference year is given a value equal to 100. Subsequent indices are expressed as a percentage of the base year.
