Transcript HICP - Народна банка на Република

Workshop: "Problems in measuring
inflation"
Skopje, 22 May 2007
HICP, past achievements and future challenges
Jarko PASANEN
Unit D-4: Price Statistics
[email protected]
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GENERAL BACKGROUND
 Required by EU Treaty (Maastricht Treaty)
 The HICPs (Harmonized Indices of Consumer Prices) are a
set of EU Consumer Price Indices calculated according to a
harmonized approach
 The HICPs are used for:
 assessing price convergence in the EU,
 for monitoring price stability in the euro area,
 for indexing social benefits or contracts and
 as input to other economic analysis
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 Development started 1993; First published 1997
 Methodology based on minimum standards practices
– Generated in cooperation with CPI experts
– Removing obvious biases and non-comparabilities
 Designed for International Comparison
 Produce comparable and reliable Price Indices
 Standards in form of binding regulations
 Compliance monitored regularly
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LEGAL FRAMEWORK
 Article 121 of the Treaty and Article 1 of the protocol on the
convergence criteria state that inflation should be measured on a
comparable basis.
 Council Regulation (EC) No 2494/95 of October 1995 concerning
harmonized indices of consumer prices (the so-called framework
HICP Council Regulation)
 to answer the need for EU’s fiscal and monetary authorities to have
regular and timely consumer price indices for the purpose of
providing comparisons of inflation in the macro-economic and
international context
 15 implementing Commission and Council Regulations
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Initial implementing measures (1749/1996)
Sub-indices (2214/1996)
Weights (2454/1997)
Coverage of goods and services (1687/1998)
Geographic and population coverage (1688/1998)
Treatment of tariffs (2646/1998)
Treatment of insurance (1617/1999)
Revised sub-indices (1749/1999)
Treatment of products in the health, education and social
protection sectors (2166/1999)
Timing of entering purchaser prices (2601/2000)
Treatment of price reductions (2602/2000)
Treatment of service charges (1920/2001 and corrigenda)
Minimum standards for revisions (1921/2001 and corrigenda)
Common index reference period (1708/2005)
Temporal coverage of price collection (701/2006)
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The key HICPs are:
 The Monetary Union Index of Consumer Prices (MUICP)
 aggregate indices covering the countries in the euro area
 The ‘flash estimate’ for the MUICP
 The European Index of Consumer Prices (EICP)
 euro area plus the other EU countries
 The national HICPs
 for each of the EU Member States
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DATA REQUIREMENTS
 monthly indices delivered according to a strict pre-announced
schedule (on average at the 14th day of every month), compiled
and classified according to COICOP/HICP

price-updated annual weights
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SDDS – methodological documentation
 Member States must provide Eurostat at its request with the
information necessary to assess compliance with the harmonized
standards
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PRIORITIES AND FUTURE WORK
 Incorporation of owner-occupied housing expenditure in
the consumption basket underlying the HICP
 OOH pilot project
 Standards and harmonisation of quality adjustment and
sampling methods
 Quality Adjustment standards
 Revision of Regulation (EC) No 1749/96, on sampling and quality
adjustment
 Specific standards on clothing, footwear, books, CDs, computer
games and cars
 CENEX
 Sampling
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PRIORITIES AND FUTURE WORK, cont’d
 Treatment of seasonal products
 Development of the COICOP/HICP classification
 Consolidation and codification of the HICP legal framework
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HICP - National Dimension
Countries are
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Responsible for
implementation of Regulations covering the
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compilation and transmission of national
HICP to Eurostat
Responsible for Quality Control
Invited to contribute to further input to the EU harmonization
process
Responsible for
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Some remarks
 HICP legislation is a part of Acquis
But HICP data required even before accession
Better implement as soon as possible
Take full advantage of Twinning
 Regulations are guidance in form of legislation
Emphasis on the content, not on the form
 HICP standards are a moving target
Important to take part in the work (e.g. WG discussions)
 Utilise synergies between CPI and HICP
HICP can be largely based on CPI
 Eurostat will provide advice and assistance
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FURTHER INFORMATION
HICP dedicated section on Eurostat’s website:
 http://ec.europa.eu/eurostat
special topics  HICP
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