Harmonised index of consumer prices (HICP) (prc_hicp)

National Reference Metadata in Euro SDMX Metadata Structure (ESMS)

Compiling agency: Lithuanian Department of Statistics (Statistics Lithuania)

Time Dimension: 2017-A0

Data Provider: LT1

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

Lithuanian Department of Statistics (Statistics Lithuania)

1.2. Contact organisation unit

Price Statistics Division

1.5. Contact mail address

29 Gedimino Ave. /LT-01500 Vilnius , Lithuania


2. Metadata update Top
2.1. Metadata last certified 06/04/2017
2.2. Metadata last posted 06/04/2017
2.3. Metadata last update 06/04/2017


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 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 for the purposes of directly satisfying consumer needs. 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

European Classification of Individual Consumption by Purpose (ECOICOP).

3.3. Coverage - sector

HICP cover the whole household sector, more precisely consumption expenditure for the goods and services that are acquired by households.

3.4. Statistical concepts and definitions

The HICP is published as follows:

1. Monthly:

  • Indices (HICP: 2015=100 and 2005=100 (from January 1996 to December 2015); HICP at constant tax rates: 2015=100 and 2005=100 (from January 2003 to December 2015)
  • Annual rates of change
  • Monthly rates of change
  • 12-month average rates of change

2. Annually:

  • Average indices and rates of change
  • ECOICOP categories 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 territory of the country 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).

HICP comprises all purchases by households within the economic territory of the country; those by both resident and non-resident households (i.e. domestic concept). HICP covers 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

HICP covers the entire area of Lithuania. 18 territorial units representing the whole country are selected for the price survey using a cut-off sampling method at the first stage (towns containing a population less than 5 500 are rejected) and a purposive sampling method at the second stage. These units are made up of 10 counties and 8 regional centres (towns and cities).
The same geographical sample is used for national CPI and HICP. There is no strict stratification but prices are collected in small, medium towns and 5 cities. Prices for food, non-alcoholic and alcoholic beverages and tobacco are collected additionally in 10 villages.

3.8. Coverage - Time

HICPs at all ECOICOP levels with harmonised coverage and methodology are available from January 1996.

HICP-CT time series are available from January 2003.

3.9. Base period

The index reference period of the HICP is the year 2015 (2015=100).


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 reference period);
  • Percentage change on the same period of the previous year (rate);
  • Percentage change on the previous period (rate);

Proportion of the total expenditure (weights) expressed in per milles.


5. Reference Period Top

Month.


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

Harmonised Indices of Consumer Prices (HICPs) are harmonised inflation figures required under the Treaty on the Functioning of the European Union. Regulation (EC) No 2016/792 of the European Parliament and of the Council of 11 May 2016 on harmonised indices of consumer prices and the house price index, and repealing Council Regulation (EC) No 2494/95 sets the legal basis for establishing a harmonised methodology for the compilation of the HICPs, the MUICP and the EICP.

Regulations adopted on the basis of Regulation (EC) No 2494/95, establishing the specific rules and governing such issues as the quality of weights, construction and transmission 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 that are proportional to transaction values, revision policy, new index reference period, temporal coverage of price collection, sampling replacement and quality adjustment procedures, treatment of seasonal products, establishing of owner-occupied housing price indices, transmission and dissemination of harmonised indices of consumer prices at constant tax rates, shall remain applicable for a transitional period, which shall end on the date of application of the implementing acts first adopted on the basis of Articles 3(6), 3(9), 3(10), 4(4), 5(6) and 7(6) of this Regulation No 2016/792, which shall be the same date for all of those implementing acts.

All relevant regulations as well as recommendations can be found in the HICP section on Eurostat's website under Methodology => Legislation and Recommendations.

6.2. Institutional Mandate - data sharing

Statistics Lithuania is the only institution in the country engaged in the production of the HICP.


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 European statistics and repealing Regulation (EC, Euratom) No 1101/2008 of the European Parliament and of the Council on the transmission of data subject to statistical confidentiality to the Statistical Office of the European Communities, Council Regulation (EC) No 322/97 on Community Statistics, and Council Decision 89/382/EEC, Euratom establishing a Committee on the Statistical Programmes of the European Communities (OJ 2009 L87, p. 164).

In the process of statistical data collection, processing and analysis and dissemination of statistical information, Statistics Lithuania fully guarantees the confidentiality of the data submitted by respondents (households, enterprises, institutions, organisations and other statistical units), as defined in the Confidentiality Policy Guidelines of Statistics Lithuania.

7.2. Confidentiality - data treatment

According to policy rules laid down in Regulation (EC) No 223/2009.

Law on Statistics of the Republic of Lithuania: Statistical data collected for official statistics purposes may be used exclusively for the preparation of statistical information. Where the respondent about whom or whose activity results the primary statistical data have been collected may be directly or indirectly identified on the basis of official statistical data, such official statistical data shall be confidential and protected in the manner prescribed by laws.

Integrated Statistical Information System Data Security Regulations and Rules for the Secure Management of Electronic Information in the Integrated Statistical Information System, approved by Order No DĮ-42 of 20 February 2015 of the Director General of Statistics Lithuania, amended by Order No DĮ-216 of 25 October 2016 of the Director General of Statistics Lithuania.


8. Release policy Top
8.1. Release calendar

Statistical information is published in accordance with an approved release calendar placed on the Official Statistics Portal of Lithuania.

8.2. Release calendar access

Eurostat's website.

Approved release calendar of Statistics Lithuania.

8.3. Release policy - user access

The data are released simultaneously to all interested parties by issuing the news release on HICP in Lithuanian that is published on the Official Statistics Portal, according to an approved statistical information release calendar pursuant to the Rules for the Preparation and Dissemination of Statistical Information, approved by Order No DĮ-212 of 26 September 2014 of the Director General of Statistics Lithuania and sent by e-mail to the media. Copies are available at Statistics Lithuania, or can also be sent by e-mail or faxed to other users on request.

With regard to the Rules for the Preparation and Dissemination of Statistical Information, Statistics Lithuania provides an opportunity for the Prime Minister and Minister of Finance, Economy, and Social Security and Labour of the Republic of Lithuania to receive news releases on price changes calculated based on the HICP half an hour prior to the official release of respective statistical information. The persons listed above are obligated not to disseminate statistical information before its official release.


9. Frequency of dissemination Top

Harmonised indices of consumer price are produced and disseminated monthly.


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

A news release on the inflation flash estimate calculated based on the HICP is published on the penultimate day of the reference month. The HICP is published in a special news release on the 7th (in February, on the 11th ) working day after the end of the reporting month at 11:00 a. m. local time in the Lithuania. Starting from January 2009 the news release in English is subsequently published.
News releases can be downloaded from the approved release calendar of Statistics Lithuania.
Additional information notes are issued when significant changes in the CPI/HICP compilation methodology occur, e.g. on the treatment of seasonal products, change of index reference period.

10.2. Dissemination format - Publications

HICPs are published in the following publications of Statistics Lithuania: the monthly publication Economic and Social Development in Lithuania (All-items, inflation calculated based on the HICP) and the Statistical Yearbook of Lithuania (All-items, HICP with 2015=100 and 12-month average rate of change) which can be downloaded from the e-library of the Official Statistics Portal.

10.3. Dissemination format - online database

Eurostat HICP database.

Database of Indicators of the Official Statistics Portal. The Database of Indicators provides the monthly  HICPs (2015=100) as well as monthly, annual and 12-month average rates of change and comparative weights starting with January 1996: the all-items HICP, 12 divisions, 39 groups, 77 classes and 220 sub-classes, 9 special aggregates of ECOICOP.

10.4. Dissemination format - microdata access

More detailed breakdowns of data (lower than the 5th digit level of ECOICOP), as long as they are not confidential, can be provided to users on request without a breach of the confidentiality principle.

10.5. Dissemination format - other

Not available.

10.6. Documentation on methodology

A complete description of the methodology used to compile the HICP is published on the Statistics Lithuania Internet website as a separate document in Lithuanian only.
A brief description of the methodology is also published in the Statistical Yearbook of Lithuania.  
Written procedures on the construction of some sub-indices, quality adjustment methods, Manual for Price Collectors also exist (only in Lithuanian).

The HICP metadata (in Lithuanian and English) are available on the Official Statistics Portal.

10.7. Quality management - documentation

See Eurostat's Compliance Monitoring Reports of 2006 and 2014 and HICP metadata on Official Statistics Portal.


11. Quality management Top
11.1. Quality assurance

In order to ensure the quality of statistical information and its own activities, Statistics Lithuania follows the provisions of the Quality Declaration of the European Statistical System (ESS) and the European Statistics Code of Practice. On 20–24 October 2014, a peer review on the implementation of the European Statistics Code of Practice, initiated by Eurostat, took place in Lithuania.

In 2007, a quality management system, conforming with the requirements of the international quality management system standard ISO 9001, was introduced at Statistics Lithuania. In 2010, 2013 and 2016, the quality management system was re-certified.

A software for the computerized system for the transmission, processing, and aggregation of data has been developed.

A random or targeted audit of individual price collectors is carried out by the specialists of the Price Statistics Division.

General quality assurance framework in Statistics Lithuania.

11.2. Quality management - assessment

The quality of the information on the HICP complies with the accuracy, timeliness and punctuality, comparability and compatibility requirements.

Eurostat periodically verifies the compliance of the Lithuanian HICP with the EU requirements and performs quality monitoring. In 2006, Eurostat verified the compliance of the Lithuanian HICP with the EU requirements and evaluated it as appropriate.

In March 2013, the compliance of the Lithuanian HICP with the EU requirements was checked by Eurostat, the Directorate-General for Economic and Financial Affairs and the European Central Bank. During the assessment of compliance it was verified that Lithuanian HICP meets the EU requirements, the quality of consumer price statistics was improved (see the Compliance Monitoring Reports).

A self-assessment is periodically performed by the managers of the statistical survey (DESAP).


12. Relevance Top
12.1. Relevance - User Needs

The HICP is the instrument for the accomplishment of comparisons on the international scale. The HICPs are necessary for monitoring the price stability in the EU Member States and euro area and for the assessment of the economic convergence. Sometimes, it is used as an instrument for indexation and compensation according to contracts.

12.2. Relevance - User Satisfaction

Starting from 2005, Statistics Lithuania carries out a general user opinion surveys on a regular basis. The Official Statistics Portal traffic is monitored; website visitor opinion polls, general opinion polls on the products and services of Statistics Lithuania, target user group opinion polls and other surveys are conducted. The said surveys are aimed at the assessment of the overall demand for and necessity of statistical information in general and specific statistical indicators in particular. From 2007, estimation of the customer satisfaction level has been started.

The Methodology for evaluation of the Customer satisfaction index was approved in January 2008. It relates to the relevance, sufficiency, clarity, reliability / trust, as well as quality and one of the national interests on visibility of the official statistics.

A special survey of HICP user satisfaction was not conducted.

12.3. Completeness

All ECOICOP categories accounting at least one part in a thousand of the total expenditure are calculated and transmitted to Eurostat.


13. Accuracy Top
13.1. Accuracy - overall

The accuracy of source data is monitored by assessing the methodological soundness of price and weights’ sources and the adherence to the methodological recommendations according to the general system of measuring and monitoring the quality of performance in place at Statistics Lithuania. The main errors occur due to incorrect recording, entering of prices, selection of a measuring unit, as well as mismatch of the selected product to the description of the representative product.

The inaccuracy of the household budget statistical survey data, which are used for the detailing of the weights, is determined by the tendency for households to hide certain expenditure (e.g. on alcoholic beverages and tobacco products) and refusal of some households to participate in the household budget statistical survey.

To reduce the number of price recording and entering errors, verification functions are installed in the mobile devices used for price recording and in primary data verification software used at the Price Statistics Division, outlets in territorial units are visited to carry out follow-up checks to confirm the reported prices.

The general system for measurement and monitoring of performance quality is implemented at Statistics Lithuania. The following tools for HICP quality monitoring and assurance are used:

  • Self-assessment of survey managers (based on DESAP (European checklists for survey managers));
  • Training of price collectors;
  • Testing of the previously approved statistical questionnaires.

The requirements of the geographical and population coverage of the HICP have been implemented.
The type of consumer price survey and the price collection methods ensure sufficient coverage and timeliness.
Furthermore, accuracy of the HICP is continuously improved by implementation of new HICP standards and concrete best practices of other national statistical institutions of EU Member States.

13.2. Sampling error

Statistics Lithuania does not produce numerical estimates of HICP sampling errors.

13.3. Non-sampling error

For the HICPs, non-sampling errors are not quantified. Statistics Lithuania tries to reduce non-sampling errors through continuous methodological and survey process improvements, such as using mobile devices in the price collection process, which can help avoiding coding and typing errors. In some cases, the staff of the Price Statistics Division revises the information on Internet websites of outlets where prices are collected. Every month, about 9 per cent of prices are estimated, of which 4.4 per cent due to withdrawal of seasonal goods from the market.


14. Timeliness and punctuality Top
14.1. Timeliness

Flash estimate of the HICP is produced and issued as well as provided to Eurostat on the penultimate calendar day of the reporting month.

HICP is issued each month at 11:00 a.m. (local time) on the 7th working day after the end of the reporting month according to the approved Advanced Release Calendar. The HICP for January is released later, on 11th working days of February, due to introduction of the updated weights.

14.2. Punctuality

Since the launch, in January 2003, the HICP has always been published punctually on the pre-announced release dates and at the same day provided to Eurostat.


15. Coherence and comparability Top
15.1. Comparability - geographical

The Lithuanian HICP is comparable with HICPs of other EU Member States. Requirements of EU regulations harmonising HICP definitions and classifications have been implemented into Lithuanian HICP. The HICP is produced based on HICP minimum standards.

Lithuanian HICP is produced only at the country level.

15.2. Comparability - over time

HICP data are fully comparable over time. There have been several improvements in the methodology since the HICP was introduced with the aim of improving reliability and comparability of the HICP, implementation of ECOICOP. These changes may have introduced breaks in time series.

15.3. Coherence - cross domain

The domestic concept of the HICP coincides with the concept of the national accounts.

Differences between the HICP and national CPI
HICP differs from the national CPI in purpose, coverage, weights and classification.
Purpose. The HICP is used for the measurement of inflation in the EU and international comparisons, calculation of European index of consumer prices, Monetary Union index of consumer prices and European Economic Area index of consumer prices. The country’s compliance with the price stability criterion referred to in Article 140 of the Treaty on the Functioning of the European Union is assessed taking into consideration the HICP-based inflation rate. The CPI is used for the measurement of inflation on the national scale and serves as a principal tool in indexation.

Coverage. In addition to the monetary consumption expenditure of country’s residents, the HICP covers the expenditure of non-residents and that of foreign visitors within the economic territory of the country. The CPI covers only the consumption expenditure of the residents of the country within the economic territory of the country. The HICP does not cover household expenditure on games of chance.

Weights. Due to the different coverage of consumption expenditure, different weighting systems are used for the calculation of the HICP and the CPI. This is the main factor causing differences in the value of indices.

Classifications. The HICP is compiled on the basis of the  ECOICOP. The CPI is compiled on the basis of the COICOP (Classification of Individual Consumption by Purpose).

15.4. Coherence - internal

HICPs are internally coherent. Lower-level price indices are aggregated to higher-level price indices, using the monetary consumption expenditure structure as weights.


16. Cost and Burden Top

The preparation of statistical data for the calculation of the HICP does not result in the increase of the administrative burden for respondents.


17. Data revision Top
17.1. Data revision - policy

HICP series, including back data, are revisable under the terms set in the 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. Corrections are made if it is likely that the influence of the error on the average relative yearly change of prices is equal to or higher than 0.1 percentage point. Users are informed about the changes and results immediately. Revisions of HICP due to changes in methodological and harmonised rules are not required.

17.2. Data revision - practice

In order to achieve better harmonisation of the interim HICP for 1996–2000, implement requirements of the Council Regulation (EC) No 1687/98 concerning the extended coverage and of the Commission Regulation (EC) No 1749/1999 concerning sub-indices of the HICP, improve the quality of HICP as well as provide more detailed sub-indices to the users, Statistics Lithuania performed a revision of time series and recalculated HICP for 1996–2000. HICPs for 1996–2000 were linked with HICPs for 2001–2005, and time series of the revised HICP were composed using the reference period 1996 (1996=100). The revision of the previous periods' HICP influenced the values of the later period's HICPs to some extent.

Pursuant to Commission Regulation (EU) No 2015/2010 of 11 November 2015 amending Regulation (EC) No 1708/2005 laying down detailed rules for the implementation of Council Regulation (EC) No 2494/95 as regards the common index reference period for the harmonised index of consumer prices and following Eurostat’s procedure, Statistics Lithuania recalculated the HICP time series according to the new index reference period 2015=100 using unrounded indices, and reclassified some products according to ECOICOP.


18. Statistical processing Top
18.1. Source data

Sample size

In 2017, prices of 918 consumer goods and services are observed monthly in about 4 200 outlets.

Number of price observations per month: about 67 800

01 Food and non-alcoholic beverages 24 600
02
Alcoholic beverages, tobacco 6 000
03
Clothing and footwear 6 500
04
Housing, water, electricity, gas and other fuels 1 500
05
Furnishings, household equipment and routine maintenance of the house 7 300
06
Health 6 600
07
Transport 2 600
08
Communications 600
09
Recreation and culture 4 800
10
Education 900
11
Restaurants and hotels 1 700
12
Miscellaneous goods and services 4 700
 
Number of representative products at the division classification level (in 2017)
 
All-items: 918 
01
Food and non-alcoholic beverages 256
02
Alcoholic beverages, tobacco 57
03
Clothing and footwear 106
04
Housing, water, electricity, gas and other fuels 37
05
Furnishings, household equipment and routine maintenance of the house 101
06
Health 94
07
Transport 46 
08
Communications 10 
09
Recreation and culture 94
10
Education 9
11
Restaurants and hotels 40
12
Miscellaneous goods and services 68

18.2. Frequency of data collection

Timing of price observation

Prices are collected monthly. The collection of primary statistical data on retail prices of all goods and services is started on the first working day of each reporting month. Prices of goods and services are recorded on the 1st–21st day of each reporting month (the main price collection takes 14 working days); prices of seasonal food products and fuels are additionally recorded on the 22nd–30th day (the price collection takes 4 working days).

18.3. Data collection

Price collection approach and sources

Local and central price collection is used.

The major part (97 per cent) of price quatations of consumer goods and services are recorded by price collectors visiting trade and service outlets selected for the price survey. Prices of cold water, heat energy, rent of apartments within the municipal stock of dwellings, refuse and sewerage collection, elevator operation, local road transport, certain educational and social services are collected by price collectors on the basis of the legal acts of local authorities. Prices of some goods and services are collected by phone.

3 per cent of price quatations are collected centrally. Prices of actual rentals from private persons, electricity, natural gas, information processing equipment, cars, technical inspection of vehicles, railway and air transport, sanatorium, post, telecommunications, package holidays, financial, some educational, notary and certain other services are collected by the specialists of the Price Statistics Division of Statistics Lithuania on the basis of the relevant legislation, pricelists and information published on the websites of enterprises.

The Commission Regulation (EC) No 2646/98 of December 1998 on tariffs has been applied in areas of electricity, natural gas, heat energy, telecommunication services, postal services and transport services. Prices are collected, the weights are constructed and the sub-indices are calculated taking into consideration the requirements laid down in the above mentioned Commission Regulation. Each sub-index involving tariff prices has a separate weighting system. To build up the weighting of different tariffs within the sub-index, statistical information is obtained from Communications Regulatory Authority and companies supplying the goods or services to households. The latter provide statistical information on the revenue gained from households taking into account the tariff system of the company. If necessary, the separate weights systems are worked out for each territorial unit with the aim of calculating the sub-index for specific products more precisely.

Tools of price collection

The great majority of prices is collected by price collectors using mobile devices.

Electronic statistical questionnaires are used to collect price data from real estate agencies on actual rentals (quarterly) and from insurance companies – on prices for insurance services (monthly).

Sometimes prices are received via telephone inquiries.

Outlet selection

Purposive sampling is used for the selection of outlets.

Outlets are selected at the level of territorial units from Economic Entities Register and are chosen to properly represent the existing trade and service network in terms of specialization, geographical location and form of ownership of the outlet. The sampling function is delegated to price collectors.
To ensure that the most popular outlets where majority of consumers do their shopping would be selected, the sample is done taking into account the retail turnover of retail trade outlets and revenues of the services’ outlets from the provision of services to households. In total, 8–10 outlets have to be selected in cities (leading to 8–10 price quotes for each product), 6–8 outlets have to be selected in medium towns (leading to 6–8 price quotes for each product) and 4–6 outlets – in small towns (4–6 price quotes for each product). 10 outlets (one per county) are selected in the countryside to collect prices for food products, non-alcoholic and alcoholic beverages and tobacco.
For central price collection, outlets are sampled by the specialists of the Price Statistics Division.

Large, medium and small trade outlets, specialized, combined, and supermarkets, big stores, marketplaces, kiosks, petrol stations and outlets providing services are included in the sample from 2014, such outlet category as an Internet shops is also included. Mail order is not included.
Every year, the sample of outlets is updated: new outlets are included in the survey, outlets that have become unpopular are excluded. The sample of outlets is renewed each year by 5 per cent, on average. When a shop closes between updates it is replaced with a similar shop.
Technique of product selection and specification

The Price Statistics Division is responsible for the preparation of the set of representative goods and services that is common for all territorial units. The set of representative products is established following the purposive sampling procedure. To identify products which are important to consumers, the consumer market developments are observed by central staff, available information on the Internet and mass media as well as consultations with producers and sellers of consumer goods and services is used; Household Budget Survey statistical data are analysed. A product is selected for the price survey when its share accounts for at least 0.01 per cent in the total household final monetary consumption expenditure. The main criteria to determine the set of consumers' goods and services for the price survey are as follows: comparative weight of a product in the total consumption expenditure, continued availability in the market, high demand among consumers. The set of representative products covers a mixture of loose (e.g. food, clothing, footwear) and tight (e.g. alcoholic beverages) descriptions. Each product is described presenting the basic technical and qualitative characteristics (percentage of fat in milk, percentage of wool in cloth, size, power, capacity, dimensions, etc.).

The selection of specific product-offers of the representative products within agreed products’ descriptions in the outlets is delegated to price collectors. In every outlet, price collectors have to select the most popular and frequently bought product-offer best meeting the general description and suitable for the price collection. For each representative product, one specific variety is selected. The assistance of retailers is used in this process. Additional most important characteristics (e.g. colour, composition, country of manufacture of the product, the manufacturing company or packager, brand name, model, the packaging type, specifications, capacity, size etc.) are recorded to ensure easy identification in the subsequent months and to assist with product replacement procedures when required.
There are written instructions for price collectors on how to select the most popular product-offer in the outlet. This issue is also discussed and additional guidance is given during annual meetings with price collectors.

18.4. Data validation

Primary validation

Monthly checks against errors and mistakes in price information are carried out by both the central and the local staff.

Price collectors carry out the primary verification and editing of the primary price data collected. Some checking functions have been installed in the mobile devices software. When outliers (e.g. the change in price from the previous month is more than 50%) are detected during the collection, the price collector immediately gets warning either to correct the data or to confirm it providing some explanation. The software also provides facilities of sorting of selected goods and services; protection from missing or duplication of the product or outlet; the display of the 12-months history of price quotes for each product. Price collectors have access to the central database and can check the transmitted data. After entering and checking the data, price collectors transmit them by the Internet together with explanations of reasons on the individual price observation if unusual price changes are obtained, according to the approved timetable by the Price Statistics Division. The staff from the Price Statistics Division periodically visits the territorial units to carry out follow-up checks in outlets to confirm the reported prices.

Secondary validation

The Price Statistics Division carries out the secondary verification and editing of the statistical data received and confirmation of the data relevance for further calculations using the software designed to define outliers, missing prices and quality differences, to make estimations for missing prices, to recalculate prices due to quality changes, to validate the data. In some cases, dubious price changes are checked by reference back to the outlet. Prices and price changes may also be checked with domestic producers and suppliers of goods and services where these suspicions remain. The staff of the Price Statistics Division clarifies all uncertainties with the price collectors using the queries sent to price collectors via software for data collection and verification, e-mail and by the telephone.

Preliminary price indices of products are crosschecked against the PPI and information received from other institutions, information regarding changes in VAT, excise and import duty, other Government intervention, reports on unusual seasonal variations due to adverse weather conditions. The information in media is observed in order to know more about what happens in business sector, particularly in manufacturing, import and wholesale. The impact of price change of separate products or their groups on the overall consumer price rate of change is calculated. The preliminary results of the national CPI/HICP are then discussed during the monthly meetings of the staff involved in the production of consumer price statistics (CPI/HICP).

Additional data quality checks are carried out by Eurostat.

18.5. Data compilation

Weights

The principal source for the development of a weighting system is the data on household final monetary expenditure for the acquisition of consumer goods and services obtained from national accounts and a household budget survey. Other statistical data sources are also used for the development of the weighting system: non-observed expenditure of private and institutional households, foreign visitors and non-residents of Lithuania is assessed using domestic trade, transport and service, tourism, energy, social statistics and information provided by other institutions and enterprises; monetary consumption expenditure of households and foreign visitors is detailed on the basis of industrial, domestic and foreign trade, educational, transport and service, tourism statistics, information and data from other institutions and enterprises. The number of weights at the lowest level of aggregation is 918.

The weights are reviewed and updated each year. The critical expenditure are adjusted using the most recent statistical data (domestic trade, transport and services, energy statistics) as well as the information from other enterprises. Data for the weights reference period are price updated to the price reference period (December of the previous year).
The weights reference period for 2017 HICP is the national accounts data of the year 2015 and HBS data of 2012.

Computation of lowest-level indices

At the first stage of the HICP calculation, the average price is obtained of each representative product in each territorial unit using the arithmetic mean. For all elementary aggregate indices, the Dutot formula is used. The average price of each representative product in the reporting month is compared with the corresponding average price of the previous month. The short-term price ratio is calculated for each representative product in each territorial unit. The resulting short-term price ratio is multiplied by the long-term price ratio of the previous month to derive the long-term price ratio of each representative product in each territorial unit for the reporting month compared to December of previous year.

Computation of higher level indices

The long-term price ratio for the reporting month of each product in each territorial unit is weighted by the appropriate share of total inhabitants in Lithuania. The result of this procedure is to produce price indices for each representative product at the national level.

Price indices of representative products are aggregated to higher-level price indices and the country’s All-items HICP according to the Laspeyres-type formula. Product price indices are aggregated into the price indices of sub-classes, classes, groups and divisions of the ECOICOP.

Treatment of missing products and replacements

Where the product is temporarily unavailable, the price is estimated.

The prices of those products whose prices were not registered are estimated by the following methods: 1) the price of the previous month may be repeated if the prices of the same product in other outlets have not changed or changed very inconsiderably; 2) a missing price may be estimated using the short-term price ratio of the same product computed on the basis of the prices recorded in other outlets of the same or other territorial units, i.e. the price of the previous month is multiplied by a short-term price ratio; 3) the missing price may be estimated on the basis of a short-term price ratio of a similar product, i.e. the price of the previous month is multiplied by a short-term price ratio of a similar product or a short-term price ratio of a higher level. However, the price may be estimated only for two consecutive months; afterwards, a new product must be selected to replace the product that is no longer available;

Introduction of newly significant goods and services

A list of representative products is revised annually. At the same frequency new products are brought in the sample of goods and services to be surveyed for the CPI/HICP needs. Within 12 months, new products are implemented as replacements. The new product-offers replace already selected product-offers when they have lost their importance or disappeared from the outlets.
Aiming to identify new goods and services, which appear on the consumer market or became significant, the staff of the Price Statistics Division investigates the market developments using all the information gained from producers, importers and consultants in the shops, price collectors, available on the Internet, in the media, catalogues, provided in statistical reports of producers, products surveyed for the purpose of calculation of Purchasing Power Parities.
Products and product aggregates close to the threshold of one part per thousand of the total household final monetary consumption expenditure as required by Regulation (EC) 2016/792 of the European Parliament and of the Council of 11 May 2016 are continuously monitored using several data sources, such as market research studies, information from media, etc. The relevance of new products to households is evaluated. If it is presumed that particular new product can be significant for households, the household budget survey staff is addressed with request to include this product in the coming nearest household budget survey. A decision to introduce new product to the CPI/HICP is made when it is known that the share of monetary consumption expenditure for this particular product is not less than one part per ten thousands of the total household final monetary consumption expenditure and the price index for price-updating of weights is available.

Treatment of price reductions

If sales prices as well as other reductions in prices for goods and services are available to all potential consumers they are included in the CPI/HICP. Reduced prices for special sales stock (which will normally be of lower quality or quantity) are not observed.

Treatment of seasonal products

Particular products – some of fresh fruit, vegetables, winter or summer clothes, footwear, spare parts and fluids for vehicles are considered as seasonal. Their sale periods are from 2 to 6 months and sometimes duration and terms of every season differ from year to year.
The Lithuania's HICP is a strict annual weights index; therefore, strict annual weights are used for seasonal products. The prices of seasonal products are collected only when they are available in season period.

In the out-of-season period, prices of seasonal products are estimated by applying the minimum standards for the treatment of seasonal products in the harmonised indices of consumer prices (HICP), set in the Commission Regulation (EC) No 330/2009 of 22 April 2009.

Prices of seasonal products that are out-of-season are estimated using two methods: counter-seasonal estimation and all-seasonal estimation. Estimation is carried out in the following way:

In the first month of the out-of-season period, the monthly typical price for each seasonal product in each territorial unit is calculated as a simple arithmetic mean of prices for particular product in particular outlet in previous season and applied for the seasonal product.

From the second month of the out-of-season period, for each product, which is out-of-season, in each outlet, the monthly price is estimated using the weighted arithmetic mean of monthly short-term price ratios of products available in the reporting period. Depending on the method used (counter-seasonal estimation or all-seasonal estimation), the price is calculated differently for different seasonal products which are out-of-season. If the counter-seasonal estimation method is used, the average price is calculated using short-term price ratios of all seasonal products that are in-season belonging to the same class or sub-class. If the all-seasonal estimation method is used, the price index is calculated using the short-term price ratios of all (seasonal and non-seasonal) products belonging to the same class or sub-class. The expenditure weights of products used for estimating prices of seasonal products in each territorial unit are the same as those used for the calculation of the total HICP.

18.6. Adjustment

No seasonal adjustments are made.

Adjustment for quality differences

If the quality of the newly selected products significantly differs from that of the replaced one, the assessment of the impact of the change in quality on the increase or decrease in the price has to be made. Quality differences between the replaced and replacement product are identified through changes in technical parameters, consumption characteristics and size as recorded by price collectors (or, in the case of products collected centrally, by the staff of the Price Statistics Division). This is done with assistance from shopkeepers and their employees.

To maintain comparability between the price of the replaced and replacement product, the price of the replaced product in the previous month has to be adjusted by eliminating the impact of the change in quality. In order to reduce the number of products adjusted in terms of quality, products are grouped into product segments by consumption purpose. Brand strata are broken down by quality level, visibility, price level. Several methods can be used for quality adjustment: expert adjustment, option pricing, bridged overlap, hedonic. In some cases, the overlap method is used.

Minor changes in quality are disregarded.


19. Comment Top

None.


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