Consumer prices (ei_cp)

Reference Metadata in Euro SDMX Metadata Structure (ESMS)

Compiling agency: Eurostat, the statistical office of the European Union


Eurostat metadata
Reference metadata
1. Contact
2. Metadata update
3. Statistical presentation
4. Unit of measure
5. Reference Period
6. Institutional Mandate
7. Confidentiality
8. Release policy
9. Frequency of dissemination
10. Dissemination format
11. Accessibility of documentation
12. Quality management
13. Relevance
14. Accuracy
15. Timeliness and punctuality
16. Comparability
17. Coherence
18. Cost and Burden
19. Data revision
20. Statistical processing
21. Comment
Related Metadata
Annexes (including footnotes)



For any question on data and metadata, please contact: EUROPEAN STATISTICAL DATA SUPPORT

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1. ContactTop
1.1. Contact organisationEurostat, the statistical office of the European Union
1.2. Contact organisation unitC4: Price statistics. Purchasing power parities. Housing statistics
1.5. Contact mail address2920 Luxembourg LUXEMBOURG


2. Metadata updateTop
2.1. Metadata last certified08/03/2010
2.2. Metadata last posted08/03/2010
2.3. Metadata last update20/01/2014


3. Statistical presentationTop
3.1. Data description

Harmonized indices of consumer prices (HICPs) give comparable measures of inflation for the countries and country groups they are produced. They are economic indicators that measure the change over time of the prices of consumer goods and services acquired by households. In other words they are a set of consumer price indices (CPIs) calculated according to a harmonised approach and a single set of definitions.

In particular, HICPs provide the official measure of consumer price inflation in the euro area for the purposes of monetary policy and the assessment of inflation convergence as required under the Maastricht criteria.

HICPs are available for all EU Member States, Iceland, Norway and Switzerland. In addition to the individual country series there are three key country-group aggregate indices: the Monetary Union index of consumer prices (MUICP) covering the euro area countries, the European index of consumer prices (EICP) including all Member States, and the European Economic Area index of consumer prices (EEAICP), which in addition to the EU also covers Iceland and Norway.

The official country-group aggregates reflect the evolution of Economic and monetary union, the EU and the EEA. New Member States are chained into the index at the time of accession. In addition to these official aggregates, Eurostat computes also country aggregates with stable composition over time. For example, the aggregate 'EU-28' shows price indices covering all current 28 Member States since 1997.

There are also interim HICPs for candidate countries; Croatia and Turkey. It is expected that once those countries accede to the EU their HICPs will be fully comparable with those of the existing Member States. For USA only all-items proxy-HICP is available.

The national HICPs are produced by National Statistical Institutes, while the country-group aggregates are produced by Eurostat.

The data that is released monthly on Eurostat's free dissemination database include price indices themselves as well as their rates of change as monthly, annual and 12-month moving average changes. In addition to the headline figure, the all-items HICP, around one hundred sub-indices for different goods and services and over thirty special aggregates are made available. The relative weights for the indices, including the special aggregates, are also published for the individual countries and for the country groups.

An early estimate of the inflation rate for the euro area is published in a news release monthly, usually on the last working day of the reference month. It is called a Flash estimate.

3.2. Classification system

The HICPs are classified according to the four-digit categories and sub-categories of the COICOP/HICP (Classification of individual consumption by purpose adapted to the needs of HICPs). There are also a set of special aggregates, which combine indices in a different way than the standard COICOP.

Main COICOP headings:
00. All items (global index)
01. Food
02. Alcohol and tobacco
03. Clothing
04. Housing
05. Household equipment
06. Health
07. Transport
08. Communications
09. Recreation and culture
10. Education
11. Hotels and restaurants
12. Miscellaneous

Examples of special aggregates:
- Energy
- Food, alcohol and tobacco
- All items excluding energy
- All items excluding energy, food, alcohol and tobacco

3.3. Coverage - sector

HICPs cover the whole household sector, more precisely the goods and services that are acquired by households.

3.4. Statistical concepts and definitions

The published data is as follows:

 

Monthly data:

- Indices (HICP 2005=100)
- Monthly rates of change

- 12 month average rate of change

 

3.5. Statistical unit

Each published index or rate of change refers to the 'final monetary consumption expenditure' of the whole household sector of the corresponding geographical entity.

3.6. Statistical population

The target statistical universe is the 'household final monetary consumption expenditure' (HFMCE) within the economic territories of the countries compiling the HICP. The household sector to which the definition refers includes all individuals or groups of individuals irrespective of, in particular, the type of area in which they live, their position in the income distribution and their nationality or residence status. These definitions follow the national account concepts in the European System of Accounts (ESA 1995).

HICPs comprise all products and services purchased in monetary transactions by households within the territory of a country; those by both resident and non-resident households (i.e. 'domestic concept').

3.7. Reference area

European Union (EU), euro area (European Monetary Union), European Economic Area (EEA), EU Member States, Iceland, Norway Switzerland, Croatia, Turkey and the USA.

3.8. Coverage - Time

HICPs with harmonised coverage and methodology have been published since March 1997 and go back to January 1996.

3.9. Base period

HICPs are produced and published using a common index reference period (2005=100).


4. Unit of measureTop

Following units are used:

  • Index (unitless, however, the HICP can be thought of as the amount the average consumer would have to spend in a given year to buy the same basic goods and services that one would have to pay 100 monetary units for in the base period.)
  • Percentage change on the same period of the previous year (rates)
  • Percentage change on the previous month (rates).


5. Reference PeriodTop

Month (indices and rates).


6. Institutional MandateTop
6.1. Institutional Mandate - legal acts and other agreements

Harmonized Indices of Consumer Prices (HICPs) are harmonised inflation figures required under the Treaty on the Functioning of the European Union. Council Regulation (EC) No 2494/95 of 23 October 1995 (OJ L 257/1) sets the legal basis for establishing a harmonised methodology for the compilation of the HICPs, the MUICP and the EICP.

Under this Regulation, the Commission has brought forward detailed Regulations establishing the specific rules governing the production of harmonised indices. To date, 17 specific regulations governing issues as quality of weights, transmission and dissemination of sub-indices, coverage of goods and services, geographical and population coverage, minimum standards for the treatment of tariffs, insurance, health, education and social protection services, timing of entering prices, treatment of price reductions, treatment of service charges, revisions policy, new index reference period, temporal coverage of price collection and sampling, replacement and quality adjustment procedures, and seasonal items have been adopted. A recommendation on the treatment of health care has also been published.

All relevant regulations as well as further methodological details can be found in the HICP section on Eurostat's website under => Legislation.

6.2. Institutional Mandate - data sharing

None.


7. ConfidentialityTop
7.1. Confidentiality - policy

Regulation (EC) No 223/2009 on European statistics (recital 24 and Article 20(4)) of 11 March 2009 (OJ L 87, p. 164), stipulates the need to establish common principles and guidelines ensuring the confidentiality of data used for the production of European statistics and the access to those confidential data with due account for technical developments and the requirements of users in a democratic society.

7.2. Confidentiality - data treatment

According to policy rules (see point 7.1).


8. Release policyTop
8.1. Release calendar

The release calendar is publically available and published at the end of the year for the full following year.

8.2. Release calendar access

The release calendar is published on the website: HICP Release calendar  2014.

The release dates are disseminated on Euro-Indicators Release Calendar.

8.3. Release policy - user access

In line with the Community legal framework and the European Statistics Code of Practice Eurostat disseminates European statistics on Eurostat's website (see item 10 - 'Dissemination format') respecting professional independence and in an objective, professional and transparent manner in which all users are treated equitably. The detailed arrangements are governed by the Eurostat protocol on impartial access to Eurostat data for users.

In line with this protocol and on a strictly regulated basis, data on Harmonized Consumer Prices (HICPs) are sent for information to the European Central Bank (ECB) and to the European Commission Directorate General for Economic and Financial Affairs (DG ECFIN) under embargo [the evening before] prior to the official release of data.


9. Frequency of disseminationTop
Monthly.


10. Dissemination formatTop
10.1. Dissemination format - News release

News releases on-line.

10.2. Dissemination format - Publications

HICP news release, available on-line.

Statistics explained article, available on-line.

Data in Focus, available on-line.

Eurostatistics - monthly

 

10.3. Dissemination format - online database

Please consult free data on-line.

10.4. Dissemination format - microdata access

None.

10.5. Dissemination format - other

See also Eurostat's HICP section website.


11. Accessibility of documentationTop
11.1. Documentation on methodology

The statistical encyclopedia by Eurostat, Statistics Explained has a full article on the HICP methodology, and for those in a need of more detailed information; Eurostat has a dedicated section on the HICPs at its web site. Additionally, Eurostat web site has a number of technical notes on HICP that have been published, e.g:

For specific questions on HICP methodology, you can send an e-mail to this mailbox on HICP methods.

11.2. Quality management - documentation

Compliance Monitoring Information notes are available in Eurostat's website, under 'Methodology'.


12. Quality managementTop
12.1. Quality assurance

Eurostat must ensure that the statistical practices used to compile national HICPs are in compliance with HICP methodological requirements and that good practices in the field of consumer price indices are being followed. In order to achieve this aim Eurostat undertakes compliance monitoring visits to Member States, during which it reviews HICP methodological issues.

Given the importance accorded to the accuracy, reliability and comparability of the HICPs in the EU, Eurostat operates a system of compliance monitoring to ensure that the legal framework is adhered to. This includes compliance assessments on the basis of questionnaires and visits by Eurostat officials to the EU national statistical institutes to study their work on their HICPs in more detail.

Compliance monitoring is crucial in promoting confidence in HICP data and Eurostat needs to be assured that Member States are complying with the Regulations in order to support the need for high quality HICP Statistics. Recommendations are published and followed up by Eurostat. The follow-up process ensures that the recommendations are taken up. If required, further follow-up visits by Eurostat can be made.

12.2. Quality management - assessment

The quality of the HICP can be assessed to be very high. Its concepts and methodology have been developed according to international standards and using consumer price statistics experience from all EU Member States. HICPs are considered to be sufficiently accurate for all practical purposes they are put into. In particular it is the best measure of inflation for the euro area and European Union as whole as well as for the comparisons of inflation across countries for which it is compiled. The indices are disseminated around mid-month following a predetermined timetable.

Further work is ongoing to improve the quality and in particular comparability of the index. Key priorities are the treatment of owner-occupied housing (currently excluded) and greater harmonisation of methods for quality adjustment and sampling. Eurostat and the national statistical institutes are also working on additional indices, for example an HICP index at constant tax rates.


13. RelevanceTop
13.1. Relevance - User Needs

Besides as a general measure of inflation, HICPs have a variety of potential other uses, for example:

  • wage, social benefit and contract indexation
  • input to economic forecasting and analysis
  • measuring specific price trends
  • accounting purposes and deflating other series
  • inflation targeting by¬†central banks

Generally, HICPs are in particular suited for cross-country economic comparisons.

A key user of the HICPs is the European Central Bank (the ECB) who uses the euro area index (MUICP) as the main indicator for monetary policy management. The ECB and the European Commission, in particular its Economic and Financial Affairs Directorate-General use HICPs for assessing the price stability and price convergence required for entry into European Monetary Union.

The main users, apart from those above, include National Central Banks and other financial institutions; economic analysts, media and public at large.

13.2. Relevance - User Satisfaction

No information.

13.3. Completeness

No missing data. All EU Member States, Iceland, Norway Switzerland, Turkey deliver the full set of HICP indices.


14. AccuracyTop
14.1. Accuracy - overall

The accuracy of HICP is generally considered to be high. The accuracy of source data is monitored by assessing the methodological soundness of price and weight sources and the adherence to the methodological recommendations. There is a variety of data sources both for weights (National Account data, Household Budget Survey data, etc.) and prices (visits to local retailers and service providers and central collection via mail, telephone, e-mail and the internet are used). The type of survey and the price collection methods ensure sufficient coverage and timeliness. The outlets, from which prices are collected, are chosen to represent the existing trade and services network and they are based usually on three main criteria: Popularity with consumers, significant turnover from consumer sales and availability of goods and services included in the HICP basket. All the private households in the economic territory of the country are covered, whether resident or not and irrespective of their income.

Furthermore, Eurostat and the Member States are actively following up an Action Plan concerning quality adjustment and sampling issues. Concrete best practices have been agreed for a range of specific goods and services (in particular cars, consumer durables, books and CDs, clothing and computers).

14.2. Sampling error

The HICPs are statistical estimates that are subject to sampling errors because they are based on a sample of consumer prices and household expenditures, which are not the complete universe of all prices/expenditures.

The National Statistical Institutes who are responsible for the compilation of national results do not generally produce numerical estimates of HICP sampling errors because they are difficult to quantify due to the complexity of price index structures and due to the common use of non-probability sampling. Consequently, no estimate for a global HICP sampling error could be produced. 

The NSIs try to reduce the sampling errors by using a sample of consumer prices that is as large as possible, given resource constraints. Often the NSIs use models that optimise the allocation of resources by indicating the number of prices that should be observed in each geographic area and each item category, in order to minimize the variance of the all items index.

14.3. Non-sampling error

For the HICPs non-sampling errors are not quantified. Eurostat and the NSIs try to reduce non-sampling errors through continuous methodological improvements and survey process improvements such as computer assisted price collection, which can help avoiding coding and typing errors.


15. Timeliness and punctualityTop
15.1. Timeliness

The full set of HICPs is published each month according to a pre-announced schedule (about two days after the data delivery deadline) - in general between 14 and 16 days after the end of the month in question. This schedule has advanced significantly since the HICP was first published, as a result of a series of improvements to timeliness made both in the EU Member States and at Eurostat. The January News Release each year cannot be advanced and is published at the end of February due to the yearly reweighting exercise.

The Flash estimate for the Euro Area is published usually on the last working day of the reference month.

15.2. Punctuality

Since the launch, in March 1997, the HICPs for the country groups averages have always been published on the pre-announced release dates.


16. ComparabilityTop
16.1. Comparability - geographical

The comparability of HICP across countries is regarded to be high. Definitions and classifications have been harmonized in a series of legal acts that have resolved conceptual disparities. HICPs may be produced based on minimum standards that include a series of regulations that address one or more methodological issues. These methodological standards may be applied with some flexibility as long as the effect on the value of the indicator remains below 0.1%. Member States differ in the frequency of updating weights. Some countries apply a 'fixed base index formula', updating the weights in three to five-year intervals, others compute a chain-index with annual weight updating. The new Commission Regulation on weights, adopted in December 2010 and to take effect with the January 2012 index, sets new minimum standards for the quality of HICP weightings by establishing rules for the choice of the data source for weights and the frequency of updating to be applied at the European level.

The work carried out for the harmonisation of quality adjustment and sampling methods across EU countries is expected to further improve the comparability of the HICP.

16.2. Comparability - over time

HICP data are considered to be comparable over time. However, because there have been several improvements in methodology since the start of HICP some breaks in time series are prevalent.  In such cases, if basic data allowed, back calculations were performed and historical series were revised.

The implementation of the seasonal products regulation from January 2011 is the most recent methodological improvement with an impact on the series. Switzerland will only implement the seasonal products regulation in July 2011. More information can be found in the 'Information note' on the subject and the  Information note and impacts on the HICP for 2011.


17. CoherenceTop
17.1. Coherence - cross domain

There is only one set of HICPs available. Identical data is shown in several data collections. Compared to national CPIs the methods and results may differ, for further details please consult Short paper on HICP-CPI differences.

Consumer price index data are disseminated through Eurostat's website:

17.2. Coherence - internal

HICPs are internal coherent. Higher level aggregations are derived from detailed indices according to well-defined procedures.


18. Cost and BurdenTop

No information.


19. Data revisionTop
19.1. Data revision - policy

HICP series, including back data, are revisable under the terms set in Commission Regulation (EC) No 1921/2001 of 28 September 2001. The published HICP data may be revised for mistakes, new or improved information, and changes in the system of harmonised rules.

19.2. Data revision - practice

The HICP data is released monthly, and they may include some provisional data for the latest month. These are usually confirmed or revised to the final figures the following month. Other, major revisions are normally released with explanatory notes in the press release. Also substantial changes in methodology are commented with the first release of data affected by such changes.

In the monthly HICP update, new data is added and the existing data is overwritten with any revised data. Changes compared to the previous update will only be flagged for a short period; generally until the next update. Unrevised data is only available in the monthly HICP publication series 'Data in Focus'.


20. Statistical processingTop
20.1. Source data

Product selection, sampling and data collection are carried out by National Statistical Institutes. There is a variety of data sources both for weights (National Account data, Household Budget Survey data etc.) and prices (visits to local retailers and service providers and central collection via mail, telephone, email and the internet are used).

The type of survey used is chosen by National Statistical Institutes. However, all CPIs are based on the continuous measurement of a sample of prices of specified goods and services. The HICPs must be based on samples sufficient to yield reliable and comparable results, taking into account the national diversity of products and prices. Furthermore, as products or retail outlets disappear from the market, they need to be replaced with new ones. HICPs are required to be based on up-to-date samples, in particular by banning the practice whereby 'missing' prices are simply assumed to be equal to the last observed prices. The HICP will incorporate a new product when it achieves a sales volume of over one part per thousand of total consumers' expenditure covered by the HICP in a Member State.

20.2. Frequency of data collection

Since January 2008, price collection takes place across at least a one working week period at, or near, the middle of the calendar month to which the index pertains. Where products are known to typically show sharp and irregular price changes within the same month, prices are collected over a period of more than one working week. This rule applies in particular for energy products and fresh food, such as fruit and vegetables (see Regulation (EC) No 701/2006 on temporal coverage of price collection).

20.3. Data collection

The price collection methods are chosen by National Statistical Institutes as far as they ensure sufficient coverage and timeliness.

The Member States' HICPs are supplied by the National Statistical Institutes; the aggregate indices for the euro area, the EU and the EEA are compiled by Eurostat.

20.4. Data validation

Data validation is done by National Statistical Institutes; additional quality checks are carried out also by Eurostat.

20.5. Data compilation

The HICP country group aggregates for the euro area, the EU and the EEA are calculated by Eurostat using the HICPs provided by the Member States.

The computation consists of three main steps. For all countries, price changes since December of the previous year are derived from the HICPs. Then the weighted average of these national price changes is computed, using the weights of the countries and sub-indices concerned. The weight of a country is its share of HFMCE in the total of the country group. The annual price change of the country group is then chain-linked to December of the previous year in order to provide a series with a common reference period.

The euro area aggregate is compiled as a weighted average of the countries comprising the euro area. The country weights are derived from national accounts data for HFMCE, naturally expressed in euro. The index is computed as an annual chain index allowing for country weights to change each year and, consequently, for adding new Member States as they join the euro area.

For the EU and EEA HICP aggregates, the euro area is treated as a single entity to which data for the other countries is then added (the weights again use national accounts data, converted into purchasing power standards). Note that for EU enlargement in May 2004 chain-linking was also added in May to maintain the correct country coverage for both the EU and EEA aggregates.

20.6. Adjustment

No seasonal adjustments are made.

Adjustments for quality change: As HICP aims at measuring 'pure' price changes, it should be unaffected by changes in quality of products. Prices therefore need to be adjusted for changes in quality of the goods and services. Differences between Member States' quality adjustment procedures could give rise to major differences in the results. The HICP is constructed according to rules which forbid certain extreme practices, such as 'automatic linking', i.e. the assumption that the difference in price between two successive models is wholly attributable to a difference in quality (this would lead to underestimate the inflation).

For example, it is not possible to simply compare the price of a particular car with a 'similar' one sold five years ago. In the meantime the quality of that car will have changed - the comparison of prices must take account of the quality change. The price statistician must therefore make a quality adjustment - that is, he or she must estimate what part of the total price change between the two cars was really due to a change in the quality of the car and what part is a genuine price change.


21. CommentTop

Euro area inflation is measured by the MUICP ('Monetary Union Index of Consumer Prices' as defined in Council Regulation (EC) No 2494/95 of 23 October 1995) which is the official euro area aggregate. The euro area initially included Belgium, Germany, Ireland, Spain, France, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland. Greece was included from 1 January 2001, Slovenia from 1 January 2007, Cyprus and Malta from 1 January 2008 and Slovakia from January 2009. New Member States are integrated into the MUICP using a chain index formula. In other words, the euro area is treated as an entity regardless of its composition.

E.g. Greece was linked into the MUICP starting with the January 2001 index. The annual rate of change for the MUICP of each current month in 2001 is the change from the corresponding month in 2000 to December 2000 for the then eleven euro area countries combined with the change from December 2000 to the current month of 2001 for the twelve euro area countries. For analytical purposes Eurostat publishes historical series covering the old compositions up to a year after the change.

EU inflation is measured by the EICP ('European Index of Consumer Prices' as defined in Council Regulation (EC) No 2494/95 of 23 October 1995) which is the official EU aggregate. The EU included 15 Member States until 30 April 2004 and 25 Member States from 1 May 2004 until 31 December 2006, while it was enlarged to 27 Member States on 1 January 2007. New Member States have been integrated into the EICP without any computational problems, as HICPs are aggregated using a chain index formula.

Starting from May 2004, the weighted changes in the Member State's index levels are linked to the corresponding EICP index in April 2004. This means that the annual rate of change for the all-items index in, for example, May 2004 is the change from May 2003 to April 2004 (covering the 15 old Member States) combined with the change from April 2004 to May 2004 (of the 25 Member States).

Country-specific

Links to the detailed country-specific information can be found at the top of this document.


Related metadataTop


AnnexesTop