New CPI shows 1.7 percent inflation as of January 2011
As of January 2011, the rate of inflation for the country is 1.7%. For New Providence it is 1.8%and for Grand Bahama it is 0.8%, according to the new consumer price index(CPI)released by the Department of Statistics yesterday.
“The Department of Statistics advises the public that it has completed a lengthy exercise which has resulted in the revision of the Consumer Price Index(CPI), the indicator which provides the highly demanded rate of inflation,”read the release. Technology like cellular phones and MP3 players will be included in the new CPI.
The new index has a reference period of February 2010 and is therefore much more reflective of current household expenditure. The measurement of the rate of inflation based on the old index has October/November 1995 as its reference period.
The department is now utilizing the new index, the calculation of which is based on the proportion of household expenditure(referred to as the weights)on items such as food, housing, transportation, recreation, etc. The old and revised weights on these groups are available at the department, as well as a revised historical series on the index and the rate of inflation.
“As with all work done by the department, international standards and classifications are adhered to and in this instance, for the first time, the United Nations revised Classification of Individual Consumption According to Purpose(COICOP)was used by the department to classify items,”according to the release.
The use of COICOP and the inclusion of Abaco in the index are two of the major new features to the CPI.
A new software package customized for the processing, compilation and analysis of price observations, the Price Index Processor System(PIPS), is also a feature of the new CPI. This software, developed by the IMF, allows for major improvements to the methods and procedures currently used in the CPI. It facilitates the imputation of missing prices and allows for quality adjustments of prices to reflect pure price changes which are two features of critical use to the DOS. The use of this package allows for easier and faster processing of the monthly price index enabling the DOS to improve its delivery time to the public.
The Department of Statistics is also promising an increase in the number of outlets from which prices will be collected. These outlets reflect those usually visited by households. The CPI will also feature a new item structure which includes both updated spending patterns and new products.
As a result of this revision and its associated improvements, the Bahamas CPI is more comparable across the region and internationally in terms of classification, structure, methodology and processing, according to the statement. Further, as a result of this improvement and revision to the entire structure of the CPI, the department has informed the public that CPI information, the rate of inflation, will be released at the end of the second week of each month.
Businesses, researchers and the general public desiring further details may contact Shanell Moss, CPI supervisor, at 302 2421, the director of the Department of Statistics at 302-2470 or the deputy director at 302-2471.