Changes to the Consumer Price Index (CPI) beginning with the February 2013 CPI

On March 27, 2013, with the release of the Consumer Price Index (CPI) for February 2013, Statistics Canada has updated the basket of goods and services used in the calculation of the Index. This marked the first time in the Canadian CPI's history that weights were updated at a two-year interval.

The CPI tracks price movements for a representative 'basket' of goods and services Canadians purchase over time. The basket is updated periodically to ensure that the CPI remains representative of consumer spending patterns. The CPI is widely used as an indicator of the change in the general level of consumer prices, or the rate of inflation.

The new weighting pattern is based on consumer spending in 2011. It replaces the previous weights, which were based on consumer spending patterns in 2009.

One aspect of the CPI Enhancement Initiative, a five-year project to improve the quality of the CPI, is to take into account, as rapidly as possible, changes in consumer behaviours and therefore minimize the substitution effect. This is achieved by updating basket weights at more frequent two-year intervals, instead of the four-year interval which has been the most recent practice.

Moreover, the elapsed time between the basket weight reference year and the date at which the update is published has been shortened by three months. As a result, the CPI has more current weights sooner, improving their representative nature.

In addition, a revised weighting pattern for items in the basket is published. The revised weights, indicating the relative importance of the basket items, are primarily determined by Statistics Canada's Survey of Household Spending. This survey collects information on the buying habits of Canadian households.

In most other respects, changes to the CPI with this update are minimal. The current list of CPI products and product groups remains unchanged. The base year for which the CPI equals 100 remains 2002.

No changes have been made to CANSIM table numbers or series identifiers. To satisfy the needs of certain users, an All-items CPI with a base year of 1992 equaling 100 continues to be available.

For CANSIM table 326-0009, Average retail prices for gasoline and fuel oil, by urban centre, due to a lack of data availability, the average prices for Regular unleaded gasoline at full service filling stations, Premium unleaded gasoline at full service filling stations and Diesel fuel at full service filling stations are no longer published. There is no impact on the calculation of the Consumer Price Index as a result of this change. Historical information for these series will continue to be available.

Previously announced changes to the Purchase of Passenger Vehicles Index have been implemented to coincide with this update.

Appendix 1 illustrates the availability of data, by product, product group, and geography, in CANSIM and the CPI publication.

For more information, contact the Dissemination Unit (toll-free 1-866-230-2248; 613-951-9606; cpd-info-dpc@statcan.gc.ca), Consumer Prices Division.