Wednesday, September 16, 2015

Airline fares drop again in August CPI

Airline fares, which fell 5.6 percent in July, continued to fall in August according to the latest figures on the Consumer Price Index for All Urban Consumers (CPI-U) issued by the Bureau of Labor Statistics (BLS), U.S. Department of Labor.

The index for airline fares fell 3.1 percent in August, the BLS said in its Sept. 16 statement detailing the figures. The decrease means the index has posted declines in eight of the last ten months and has more than offset the nearly eight percent increase the index posted in the combined May and June figures.

The calculations of airline fares include an allowance for checked bag fees but the BLS does not include other ancillary charges.

The agency found a certain percentage of passengers checked bags. It applies that percentage to all  incoming quotes during sample rotation and then assigns the appropriate checked bag fee (assuming one bag, for either one-way or round-trip, based on the description of the quote). It also applies baggage specs to airlines that do not charge for bags so that if they start to charge in the future, the BLS could easily incorporate that price increase.

The seasonally adjusted all items figure was down 0.1 percent from the July figure. Over the last 12 months, the all items index rose 0.2 percent before seasonal adjustment.

The index  for all items less food and energy all rose increased 0.1 percent in August, the same increase as in July. The index for shelter rose, as did the indexes for apparel, tobacco, and alcoholic beverages. However, in addition to the index for airline fares, and the indexes for household furnishings and operations, recreation, and used cars and trucks also decreased in August, with the indexes for new vehicles and medical care unchanged, the BLS statement said.

The all items index increased 0.2 percent for the 12 months ending in August, the ssame increase as for the 12 months ending in July. The 12-month change in the index for all items less food and energy also remained the same, at 1.8 percent for the 12 months ending August. The food index rose 1.6 percent over the last 12 months, while the energy index declined 15.0 percent, the BLS said.

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