ABS to update the CPI basket
The September quarter 2011 issue of the Australian Consumer Price Index to be released 26 October 2011, will incorporate several key recommendations from the Outcome of the 16th Series Australian Consumer Price Index Review by the Australian Bureau of Statistics (ABS). The changes are described in an information paper: Introduction of the 16th Series Australian Consumer Price Index released today by the Bureau.
The main outcome will be to update the household expenditure weights applied to the different goods and services in the CPI basket to reflect current patterns of household expenditure. A comparison between the previous household expenditure weights (June quarter 2005) and the new household expenditure weights (June quarter 2011) is included in Appendix 3 of the release. For example, household expenditure is now relatively higher on restaurant meals and lower on beef and veal.
Previously published headline CPI (All groups CPI) will not be revised as a result of the changes. The All groups CPI for the June quarter 2011 was 0.9% for the quarter, and 3.6% through the year.
The CPI has been reviewed 16 times since its introduction in 1960; these reviews make sure that the CPI basket remains relevant to Australian purchasing patterns.
The information paper presents the new CPI expenditure weights which will be used from the September quarter 2011, details the methods used in deriving the weights and highlights major shifts in weights.
The ABS produces, together with the quarterly headline CPI, a suite of related indexes that help users understand the pattern of inflationary pressures in the Australian economy. The information paper describes the composition of these series. Following the recommendation of the 2010 Review, the ABS has decided to remove the indirect charges for deposit and loan facilities from the headline CPI pending improvements to the methodology and underlying data sources. In the meantime a new analytical series will be produced - the All groups CPI including Deposit and loans (indirect charges).
The information paper also provides a mock–up of the revised format of the September quarter 2011 publication and downloadable spreadsheets to enable users to become familiar with them before the release date.