The average cost of a market basket of goods and services in the United States dropped 0.3 percent in October, led primarily by a decline in energy costs, according to the Bureau of Labor Statistic's Consumer Price Index (CPI). Although October's index of 177.7 was down from September, it also represented an increase of 2.1 percent over the past 12 months. Overall the pace of inflation has slowed from a 12-month high of 3.73 percent in January to October's 2.1 percent.
The overall index for energy costs declined 6.3 percent in October, which is primarily the result of a 10.2 percent decrease in petroleum-based energy costs. Other categories that saw decreases were transportation (2.2 percent), other goods and services (0.7 percent) and housing (0.1 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.
