PREÅ¢URI - Institutul National de Statistica

CPI computation methodThe CPI is calculated as a Laspeyres-type index with a fixed base. Beginning with January 2013, themonthly indices with fixed base are calculated using the average prices of 2011 (2011 = 100) and theweights of the same year resulting from the average expenditure identified by the Household BudgetSurvey.The general formula for computing the Laspeyres-type index is:Llopoqo= ∑ I lo ( ) (1)∑ p qooL lo = aggregate index of the current month (l) of 2013 as against the reference year 2011;lo = current month indices as against the 2011 average by aggregation steps;Ipqo o∑ pqo= weights related to aggregation steps (relative significance of averageomonthly expenditure by household in 2011).The change in the computation base (reference year) requires establishing the average prices of therespective year for all the goods and services included in the nomenclature to be used for the calculationof monthly price indices.vip ) at variety level ( voi ) were established in a different manner for theThe average prices for 2011 (existing goods/services and for the ones newly introduced in the nomenclature, as follows:For items already existing in the nomenclature:computation of the real average price of varieties reported in 2011;imputation of the real monthly average price of all varieties for which no reporting exists (in this case, theaverage price of the item computed based on varieties prices is unchanged);computation of yearly average prices at variety level as the simple arithmetic mean of the monthlyaverage prices of 2011.For items newly introduced in the nomenclature:recording of the prices for December 2012;assimilating the new items with those already existing in the nomenclature (the case of expenditurepositions with homogeneous structure) or directly with the expenditure position (the case of nonhomogeneouspositions);establishing the average base price at variety level as a ratio between the observed price of December2012 and the index of the assimilated price at item or position level as against 2011.These average prices for the 2011 reference year remain unchanged until the next change in the base.The computation of the monthly indices with a fixed base requires the following stages:- price indices computation at variety level:vii = p l• 100 (2)vi vipovpl i = price of variety i recorded in the current month (l);vip = yearly average of variety i prices in 2011.o24