How CPI is measured

Lesson 2 of 4

How prices are collected

BLS collects prices in 75 urban areas across the country: about 94,000 prices and 8,000 rental housing quotes each month. Source 3

Prices for most goods and services are collected every month in the three largest areas (Chicago, Los Angeles and New York) and every other month elsewhere. Source 4

Each item counts in proportion to how much households spend on it, measured by the Consumer Expenditure Surveys. Starting with January 2023 data, BLS updates those weights every year. Source 5

Lesson 3 of 4

How housing is counted

For renters, the CPI uses the rents BLS collects in its housing survey. Each unit is priced every six months, and because leases often run a year, rent changes show up in the index gradually. Source 6

For homeowners, the CPI doesn't use house prices. It uses owners' equivalent rent: it assumes the change in a homeowner's shelter cost equals the change in rent for a comparable home. Source 6

Those changes come from the same rent data, not from homeowners' guesses about their own homes. Owners' equivalent rent makes up nearly a quarter of the basket. Source 5 Source 6

Lesson 4 of 4

Reading a CPI release

Releases come out at 8:30 a.m. Eastern on dates BLS publishes in advance, usually around the middle of the month after the one measured. Source 7

The monthly change is seasonally adjusted, to remove regular seasonal patterns. The 12-month change is reported before seasonal adjustment. Source 2 Source 8

Core CPI is the index for all items less food and energy. BLS publishes it in the same release. Source 8

Seasonally adjusted numbers can be revised for up to five years as seasonal factors are updated, which is why BLS suggests unadjusted data for uses such as contract escalation. Source 2

Snoki's Macro Desk posts the headline numbers on release day, with a link to the BLS release and its tables.

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