Harmonised index of consumer prices (HICP) (prc_hicp)

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. Accessibility and clarity
11. Quality management
12. Relevance
13. Accuracy
14. Timeliness and punctuality
15. Coherence and comparability
16. Cost and Burden
17. Data revision
18. Statistical processing
19. Comment
Related Metadata
Annexes (including footnotes)
National metadata



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

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1. Contact Top
1.1. Contact organisation

Eurostat, the statistical office of the European Union

1.2. Contact organisation unit

C4: Price statistics. Purchasing power parities. Housing statistics

1.5. Contact mail address

2920 Luxembourg LUXEMBOURG


2. Metadata update Top
2.1. Metadata last certified 25/02/2016
2.2. Metadata last posted 25/02/2016
2.3. Metadata last update 25/02/2016


3. Statistical presentation Top
3.1. Data description

Harmonised Indices of Consumer Prices (HICP) give comparable measures of inflation for the countries and country groups for which 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 (CPI) calculated according to a harmonised approach and a single set of definitions.

In particular, HICP 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 for accession to the euro.

HICP 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 or EA) covering the euro area countries, the European index of consumer prices (EICP or EU) 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 (EA), the EU and the EEA. The HICP for new Member States is chained into the aggregate indices at the time of accession. In addition to these official aggregates, Eurostat also computes, for analytical purposes, country aggregates with stable composition over time. For example, the aggregate 'EU-28' shows price indices covering all current 28 Member States since 1997.

HICP for Turkey (candidate country) is also published. For the USA, a proxy-HICP for the all-items and main headings is available.

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

The data released monthly on Eurostat's free dissemination database includes price indices and rates (monthly, annual and 12-month moving average changes). In addition to the headline figure '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 published for the individual countries and for the country groups, once a year, with the January data.

An early estimate of the overall inflation rate for the euro area, as well as for selected components, are published monthly, usually on the last working day of the reference month, both as a News Release and in the database. They are called 'HICP flash estimates'.

HICP at constant tax rates (HICP-CT) follows the same computation principles as the HICP, but is based on prices at constant tax rates. The comparison with the standard HICP can show the potential impact of changes in indirect taxes (e.g. VAT and excise duties) on the overall inflation (more information).
 

3.2. Classification system

The HICPs are currently classified according to the four-digit categories of the COICOP/HICP (Classification of individual consumption by purpose adapted to the needs of HICP).

Main COICOP/HICP headings:
00. All-items (global or overall index/rate)
01. Food and non-alcoholic beverages
02. Alcoholic beverages and tobacco
03. Clothing and footwear
04. Housing, water, electricity, gas and other fuels
05. Furnishings, Household equipment and routine maintenance of the house
06. Health
07. Transport
08. Communication
09. Recreation and culture
10. Education
11. Restaurants and hotels
12. Miscellaneous goods and services

Over 30 special aggregates are also calculated, which combine indices in a different way than the standard COICOP.

Examples of special aggregates:

  • Energy
  • Food, alcohol and tobacco
  • All-items excluding energy
  • All-items excluding energy, food, alcohol and tobacco

Eurostat plans to start publishing COICOP level 5 (or ECOICOP) later in 2016. Given that the provision of the back series of COICOP 5 indices from countries is not possible as far back as 2005, it was necessary to rebase the HICP to 2015=100.

Most Members States will implement the level 5 COICOP index already in their calculation starting with January 2016.

For more information, see also points 3.9 'Base period' and 19.2 'Data revision - practice'.

 

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:

HICP

Monthly data (2015=100)

  • Indices (table: prc_hicp_midx and prc_hicp_midx05 published in base 2005=100)
  • Annual rates of change (m/m-12 - table: prc_hicp_manr)
  • Monthly rates of change (m/m-1 - table: prc_hicp_mmor)
  • 12-month average rate of change (table: prc_hicp_mv12r)

Annual data

  • Average index and rate of change (table: prc_hicp_aind)
  • Country weights (table: prc_hicp_cow)
  • Item weights (table: prc_hicp_inw)

HICP-CT

Monthly data (2015=100)

  • Indices (prc_hicp_cind)
  • Annual rates of change (prc_hicp_cann)
  • Monthly rate of change (prc_hicp_cmon)

 

 

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 2010).

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

Country aggregates:

  • European Union (EU)
  • Euro area (European Monetary Union)
  • European Economic Area (EEA)

Countries:

  • EU Member States
  • Iceland
  • Norway
  • Switzerland
  • Turkey
  • USA (proxy-hicp)
3.8. Coverage - Time

HICP are published since March 1997 and go back to January 1996. HICP-CT is published, for most countries, since 2002.

3.9. Base period

According to Commission Regulation 2015/2010, starting with the release of January 2016 data, HICP and HICP-CT data are produced and published using the common index reference period (2015=100).

The current series with reference 2005=100 is discontinued with the exception of the all-items indices data that will continue to be available under dataset prc_hicp_midx05.

The change of reference year causes revisions to a number of previously published inflation rates because of rounding effects. Thus, inflation rates for European and country aggregates calculated from the 2015=100 series can differ from the rates calculated from the 2005=100 series (see point on 19.2 ‘Data revision practice’).

The series 1996=100 are discontinued from the publication of the January 2016 data.

 


4. Unit of measure Top

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)
  • Percentage share of the total (weights).


5. Reference Period Top

Month (indices and rates).


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

Harmonised Indices of Consumer Prices (HICP) 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 sets the legal basis for establishing a harmonised methodology for the compilation of the HICP, the MUICP (euro area) and the EICP (EU).

Under this Regulation, the Commission has brought forward detailed Regulations establishing the specific rules governing the production of harmonised indices. To date, over 20 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 periods (2005=100 and 2015=100), temporal coverage of price collection and sampling, replacement and quality adjustment procedures, and seasonal items  have been adopted.

Recommendations on the treatment of rents, telecommunications and health care have also been agreed with Member States.

All legislation is applicable to Iceland and Norway (European Economic Area countries), and to Switzerland.

Legislation and recommendations can be found in the HICP section on Eurostat's website.

6.2. Institutional Mandate - data sharing

None.


7. Confidentiality Top
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

Regulation (EC) No 223/2009 of the European Parliament and of the Council, of 11 March 2009, on the transmission of data subject to statistical confidentiality to the Statistical Office of the European Communities. See also point 6.1 on rules governing user access.


8. Release policy Top
8.1. Release calendar

The release schedule is publically available and published each year around mid-November for the full following year.

8.2. Release calendar access

Eurostat website: HICP Release schedule.

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.


9. Frequency of dissemination Top

HICP and HICP-CT are disseminated monthly, around the middle of the month following the reference month.

Flash estimates for the euro area and selected components are disseminated usually on the last working day of the reference month.

No intermediate data updates are done outside calendar update dates (see release schedule under point 8.2).

 


10. Accessibility and clarity Top
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.

 

10.3. Dissemination format - online database

Please consult free data on-line.

10.4. Dissemination format - microdata access

Not applicable.

10.5. Dissemination format - other

See also Eurostat's HICP section website.

10.6. Documentation on methodology

Eurostat's statistical encyclopedia – Statistics Explained – includes a series of statistical articles relating to the HICP. Information is also gathered in the HICP dedicated section on Eurostat’s website.

The information made available includes (non-exhaustive list):

 

10.7. Quality management - documentation

Compliance monitoring Information notes are available in the Eurostat's HICP site, under 'Methodology' => Compliance monitoring.


11. Quality management Top
11.1. Quality assurance

Eurostat must ensure that the statistical practices used to compile national HICP are compliant 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 HICP 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 HICP 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.

11.2. 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. HICP 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.

There is continuous work to improve the quality and comparability of the index, developed through several Task Forces and a Working Group.


12. Relevance Top
12.1. Relevance - User Needs

Besides as a general measure of inflation, HICP 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

HICP are particularly suited for cross-country economic comparisons.

The euro area index is used by the European Central Bank (ECB) as the main indicator for monetary policy management. The ECB and the European Commission's Directorate-General for Economic and Financial Affairs use HICP for assessing price stability and price convergence required for entry into European Monetary Union.

Other users include National Central Banks; financial institutions; economic analysts; the media; and the public at large.

12.2. Relevance - User Satisfaction

No information.

12.3. Completeness

The full set of HICP indices and weights are available for most EU Member States, Iceland, Norway and Turkey since January 1996.

Specific data availability list:

  • Bulgaria: since December 1996
  • Croatia: since January 1998
  • Switzerland: since December 2004
  • US (proxy-HICP): since December 1997 for the all-items and the 12 main COICOP/HICP headings


13. Accuracy Top
13.1. 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.

13.2. 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.

13.3. 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.


14. Timeliness and punctuality Top
14.1. Timeliness

The full set of HICPs is published each month according to a pre-announced schedule, usually 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 usually published  on the last working day of the reference month.

14.2. Punctuality

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


15. Coherence and comparability Top
15.1. Comparability - geographical

The comparability of HICP across countries is regarded to be high. Definitions and classifications have been harmonised in a series of legal acts that have resolved conceptual disparities. HICPs are produced based on minimum standards, which may be applied with some flexibility as long as the effect on the value of the indicator remains below 0.1%.

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.

15.2. 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 emerge.  In such cases, if basic data allowed, back calculations were performed and historical series were revised.

 

15.3. Coherence - cross domain

There is only one set of HICP available. Identical data is shown in several data collections. Compared to national CPI the methods and results may differ.

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

  • Selected statistics => Prices (HICP) => Database
  • Selected statistics => Prices (HICP) => Main tables
  • Selected statistics => Principal European Economic Indicators (PEEIs)
15.4. Coherence - internal

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


16. Cost and Burden Top

No information.


17. Data revision Top
17.1. Data revision - policy

HICP series, including back data, are revisable at any point in time 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.

17.2. 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'.

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. A selection of the urevised series can be found in the monthly HICP publication series 'Data in Focus' in pdf format.

Starting with the release of January 2016 data, the reference year of the HICP changed to 2015=100.

The change of reference year caused revisions to a number of previously published inflation rates because of rounding effects. Thus, inflation rates for European and country aggregates calculated from the 2015=100 series can differ from the rates calculated from the 2005=100 series.

The indices for individual countries are published rounded to either one or two decimal places, in line with national practices. The index levels of European aggregates are released rounded to two decimals. The monthly and annual inflation rates are calculated from these index levels and subsequently rounded to one decimal place for publication. This practice is followed so that the published inflation rates match the corresponding released index levels.

Comparing the euro area annual inflation rates calculated from the 2015=100 series with those calculated from the 2005=100 series, some of the published rates across all COICOP levels might have been revised by plus or minus 0.1 percentage points for the data after January 2007.

At the same time, Eurostat has removed the rounding that, since the beginning of the HICP, has been applied to the HICP calculation of European and special aggregates for the indices from January 1996 to December 2005 and recalculated the indices without rounding. That way the calculation of the HICP aggregates is now done using unrounded indices throughout. As a result, there are additional revisions to the HICP rates for the data before 2007.

Moreover, some countries, when introducing the fifth level of COICOP, reviewed or are reviewing their product classification or the back data and, when need seen, re-classifying some products in order to be fully in line with the COICOP. In such cases, there are or will be minor revisions of the corresponding data.

Summary information on the revisions on the HICP is available on the HICP dedicated section on Eurostat's website.


18. Statistical processing Top
18.1. Source data

Product selection, sampling and data collection are carried out by NSIs. There is a variety of data sources both for weights (National Accounts, Household Budget Survey 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 NSIs. However, all HICPs 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.

18.2. 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).

18.3. Data collection

The price collection methods are chosen by NSIs as far as they ensure sufficient quality, according to the legislative framework underlying the production of HICP.

The Member States' and other countries' HICP are supplied by NSIs; the aggregate indices for the euro area, the EU and the EEA as well as so called 'special aggregates' are compiled by Eurostat.

18.4. Data validation

Data validation is done by NSIs; additional quality and consistency checks are also carried out by Eurostat.

18.5. Data compilation

The HICP country-group aggregates for the euro area, EU and EEA, as well as special aggregates, are calculated by Eurostat using the HICP 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 HICP
  • 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
  • Finally, the annual price change of the country group is 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 any mid-year EU enlargement, chain-linking was also added to the entry month to maintain the correct country coverage for both the EU and EEA aggregates.

18.6. Adjustment

No seasonal adjustments are made.

Adjustments for quality change: given that HICP aims at measuring 'pure' price changes, it should be unaffected by changes in the quality of products. Therefore, prices need to be adjusted for changes in quality of the goods and services. Differences between Member States' quality adjustment procedures could give rise to 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, which could 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 and 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 due to a change in the quality of the car and what part is a genuine price change.


19. Comment Top

Country-specific information

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

Rebasing 2015=100

Information


Related metadata Top
prc_hicp_esms_at - Harmonised index of consumer prices (HICP)


Annexes Top