Harmonised index of consumer prices (HICP) (prc_hicp)

National Reference Metadata in Euro SDMX Metadata Structure (ESMS)

Compiling agency: Statistics Iceland, National Statistical Instute of Iceland

Time Dimension: 2017-A0

Data Provider: IS1

Data Flow: HICP_ESMS_A


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)
 



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

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1. Contact Top
1.1. Contact organisation

Statistics Iceland, National Statistical Instute of Iceland

1.2. Contact organisation unit

Price statistics

1.5. Contact mail address

Borgartún 21a, 150 Reykjavík


2. Metadata update Top
2.1. Metadata last certified 25/04/2017
2.2. Metadata last posted 25/04/2017
2.3. Metadata last update 25/04/2017


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 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 (CPIs) calculated according to a harmonised approach and a single set of definitions.

3.2. Classification system

COICOP/HICP (Classification of Individual Consumption by Purpose adapted to the needs of Harmonised Indices of Consumer Prices).

ECOICOP (European Classification of Individual Consumption according to Purpose).

3.3. Coverage - sector

HICPs cover the whole household sector, more precisely the goods and services acquired by households.

3.4. Statistical concepts and definitions

The published is as follows:

1. Monthly data

  • Indices(HICP 2005=100, HICP: 1996=100, HICP: 2015=100)
  • Annual rates of change
  • Monthly rates of change
  • 12-month average rate of change

2. Annual data

  • Average index and rate of change
  • Country weights
  • Item weights
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 accounts concepts in the European System of Accounts (ESA 2010).

HICPs comprise all purchases by households within the territory of a country; those by both resident and non-resident households (i.e. 'domestic concept'). HICPs cover the prices paid for goods and services in monetary transactions. The prices measured are those actually faced by consumers. The HICPs exclude interest and credit charges, regarding them as financing costs rather than consumption expenditure.

3.7. Reference area

Geographical coverage

The HICP covers the entire country. Chain weights are applied for the groceries. Prices are collected in the capital area and in three towns in different parts of the country.

3.8. Coverage - Time

HICPs with harmonised coverage and methodology have been published since March 1997. Interim indices based largely on existing national Consumer Price Indices (CPIs) are available back to January 1996; these are adjusted to reduce differences in coverage of goods and services observed between national CPIs.

3.9. Base period

2005=100.


4. Unit of measure Top

Following units are used:

  • Index (actually unitless, i.e. it is the ratio of the price of the basket in a given year to the price in the base year multiplied by 100. 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 period (rates);
  • Percentage share of the total (weights).


5. Reference Period Top

Month.


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. Regulation (EU) 2016/792 of the European Parliament and of the Council sets the legal basis for establishing a harmonised methodology for the compilation of the HICP.

All relevant regulations as well as further methodological details can be found in the HICP section on Eurostat's website under Methodology => Legislation.

6.2. Institutional Mandate - data sharing

None.


7. Confidentiality Top
7.1. Confidentiality - policy

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.

7.2. Confidentiality - data treatment

According to policy rules (see point 7.1).


8. Release policy Top
8.1. Release calendar

The release calendar of Statistics Iceland is publically available and published in November each year for the full following year.

8.2. Release calendar access

Eurostat's website and Statistics Iceland's website.

8.3. Release policy - user access

Eurostat publishes the monthly results of the HICPs in Europe, including HICP results for Iceland, according to Eurostat’s release calendar, which is available on Eurostat’s website. HICP statistics are updated on the following workday on Statistics Iceland’s website. Both Eurostat and Statistics Iceland provide open access to the HICP data and thereby make the statistics public for everyone at the same time.


9. Frequency of dissemination Top

Harmonised consumer price indices are produced monthly.


10. Accessibility and clarity Top
10.1. Dissemination format - News release

None.

10.2. Dissemination format - Publications

No special publication is made of the Icelandic HICP when first available (by the end of a month).

A special press release of HICP is not published in Iceland but data are updated on the website, www.statice.is  on the next day following the publication in Luxembourg. Indices and annual changes for all the participating countries and subindices for Iceland are all released at the same time. Weights for the Icelandic subindices are published in February every year.

10.3. Dissemination format - online database

HICP database.

10.4. Dissemination format - microdata access

None.

10.5. Dissemination format - other

None.

10.6. Documentation on methodology

Metadata:

10.7. Quality management - documentation

None.


11. Quality management Top
11.1. Quality assurance

Controls on the quality of the data

Quality checks for daily necessities from grocery stores are done in two different processes.

Scanner data: All price changes resulting in a change of ± 2% for the respective COICOP group are checked for outliers.

Manually collected data: Prices are recorded twice by a separate person into the processing database and then compared. Differences are eliminated by review of the primary data.

Large price changes on individual items are inspected as well as prices that were missing in the previous month.

For other products and services large price changes are inspected. A special quality control checks items where prices are missing in the current month but had dropped a month earlier. In the case of special offers in the last month and missing price in the current month the price is changed to the pre-offer price. There is no automatic rejection of observed prices in the validation process. Each problem is considered individually. Questionable prices are checked with the supplier or are eliminated from calculations.

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. HICPs are considered to be sufficiently accurate for all practical purposes they are put into. The indices are disseminated around mid-month following a predetermined timetable.

Statistics Iceland participate in ongoing work to improve the quality and in particular comparability of the index. Key priorities are the treatment of owner-occupied housing (currently excluded) and greater harmonisation of methods for quality adjustment and sampling.


12. Relevance Top
12.1. Relevance - User Needs

Generally, HICPs are in particular suited for cross-country economic comparisons.

In Iceland the national CPI is the main inflation indicator.

12.2. Relevance - User Satisfaction

No information.

12.3. Completeness

All COICOP indices at 4-digit level are produced.


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.

13.2. Sampling error

No numerical estimates of HICP sampling errors are produced.

13.3. Non-sampling error

For the HICPs non-sampling errors are not quantified.


14. Timeliness and punctuality Top
14.1. Timeliness

Statistics Iceland has no difficulties meeting the pre-announced schedule of deliveries of HICP to Eurostat.

14.2. Punctuality

Since the launch, in March 1997, the HICP for Iceland  has 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.

15.2. Comparability - over time

HICP data are fully comparable over time. There have been several improvements in methodology since HICP was introduced with the aim of improving reliability and comparability of the HICP. These changes may have introduced breaks in time series. However back calculations under the newer standards were performed when appropriate basic data was available.

15.3. Coherence - cross domain

Differences between the HICP and national CPI

There are following differences between the HICP and the national CPI:

  • The HICP is based on the concept of domestic consumption, while the national CPI is based on the concept of national consumption. Expenses of foreign tourists, household members that are older than 74 years and of those living in institutions are included in the weight of the harmonised index but not in the Icelandic consumer price index.
  • The harmonised index is mostly a sub-index of the Icelandic consumer price index, though they differ in scope. The most significant difference is that owner-occupied housing and games of chance are included in the national CPI but not in the HICP.
15.4. Coherence - internal

HICPs are internal 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 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 data are final when first released and are not subject to revisions.

Major changes in methodology are announced in advance, while information on minor methodological changes is provided in the monthly press releases.


18. Statistical processing Top
18.1. Source data

All sub-indices of the CPIs are based on the continuous measurement of a sample of prices of specified goods and services. The price collection is based on samples deemed to be sufficient to yield reliable and comparable results, taking into account the diversity of products and prices.

18.2. Frequency of data collection

Timing of price observation

Prices are collected monthly, by law for at least one week time in the middle of a month since January 2008. Before that they were collected the first two working days of the month.

18.3. Data collection

Outlet selection

The outlets for the groceries are selected annually with help of receipts from the HES and controlled with VAT-data. Other outlets are selected judgementally, mainly by using detailed VAT-data.
Techniques of products selection and specification

The products are selected on the basis of information obtained from detailed HES data, retail trade statistics, price collectors' suggestions, producer information, market research data and other sources.

The specifications for individual good/service are normally very tight, indicating brand, size, unit, materials etc. How tight or loose the specification is depends on the nature of the product. If a product has many price determing characteristics, the specification is tighter. Looser specification are used for few food and garments products.
Price collection

Price collectors are used for groceries (01, part of 02, 05, 09, 11 and 12) and for clothing and footwear. Other prices are collected centrally using phone calls, e-mail, fax, websites.

Tariffs measured: Electricity and heating water, transport services by bus, telephone services, internet connection services, subscriptions to TV networks, insurances, and kindergarten services.

18.4. Data validation

Data validation is done by Statistics Iceland.

18.5. Data compilation

Weights

The main source for the weights is the continuous household expenditure survey. The sample each year is small and therefore a moving average of a three years survey cycle is used. The weights are updated annually and always price updated to December each year when the HICP is chain-linked. For example the weights used for 2011 are based on the HES 2006-2008. Other sources are used to verify the data and later changes (NA, VAT-reports, data on car registrations etc).  Weights are price updated to December 2010.

There are about 5 000 weights used at the lowest level of aggregation in the HICP.
Computation of the lowest-level indices

Five methods are used (reference January 2011):

Relative of geometric mean prices (Jevon) (approx 46% of the total expenditure base).

The weighted relative of geometric mean prices on groceries (approx. 25%).

Lowe or average of price relatives (Duot), (approx. 23%).

A superlative index (Fisher) (approx. 3%).

Indices (approx. 3%).

Treatment of missing items and replacements

For the groceries all available prices are used in the monthly calculation. When a non-seasonal item is temporarily missing in a given outlet, the last recorded price is retained for up to two months. When it is clear that a non-seasonal item is missing permanently (in the third month or earlier), the item is replaced with the most comparable one in the same outlet. Items are often oversampled.

Introduction of newly significant goods and services

For identifying new and newly significant goods and services, different sources of information are used, e.g. detailed HES and suggestions from price collectors, based on their knowledge of what is being actually sold in the marketplace, and market information.

The basket of goods and services, including newly significant goods and services, is updated in March every year at the time for rebasing the national CPI and otherwise when needed.

Treatment of price reductions

Seasonal sales, other sales prices and reduced prices (e.g. special offers, discounts, etc.) are included in the index when they are available to all consumers.

Treatment of seasonal items

For clothing (e.g. winter vs summer clothes ), some food items and other seasonal items (garden plants in the summer, skies, tires, etc) the last observed price is retained until the month when the item in question appears again in the shops.

Fresh fruits and vegetables are not seasonal items in Iceland as they are available in all months. All fruits, are imported from different parts of the world, where they are in-season (vegetables too, when out of season of domestic production).

18.6. Adjustment

Adjustment for quality differences

During a year, price adjustments due to quality changes are most frequently made for cars, PCs, major household appliances, clothing, and technical products. The following methods are used:

Option pricing: new cars.

Direct price comparison: e.g. clothing.

Overlap: e.g. clothing, audio-visual goods, PCs.

Bridged overlap: e.g. clothing, PCs.

Package size adjustment: e.g. food and medicines.

Judgemental QA: e.g. clothing, new cars, PCs.


19. Comment Top

None.


Related metadata Top


Annexes Top