MNI: Text of StatsCan Announcement On CPI And Used Car Prices

Statistics Canada has published a technical paper, "Measuring price change for used vehicles in the Canadian Consumer Price Index." The paper outlines the proposed plan for introducing used vehicle prices in the Consumer Price Index (CPI), including data and methods.

With the introduction of the 2021 CPI basket, Statistics Canada will use administrative data to strengthen the measurement of price change for used vehicles, which will replace the current method of measuring price change by proxy. The enhancements will be
incorporated into the calculation of the purchase of passenger vehicles index. With the introduction of used vehicle prices in the CPI, two new series will be published: purchase of new passenger vehicles (2022-04=100) and purchase of used passenger vehicles
(2022-04=100). Both price index series will be available starting April 2022 and will be published at the national level.

Used vehicle prices are scheduled to be introduced with the May 2022 monthly price change (release in June 2022), with no level adjustment for historical changes in the all-items CPI. This approach is consistent with the way other products have been introduced in the CPI such as cellular services, electronic devices and cannabis. This approach follows international best practices as well as recommendations by Statistics Canada's Price Measurement Advisory Committee.

For additional information or to provide comments on the proposed enhancement, users may contact the Consumer Prices Division at
statcan.cpddisseminationunit-dpcunitedediffusion.statcan@statcan.gc.ca.

Consumer Price Index basket update in June 2022

The CPI is based on a fixed basket of goods and services designed according to international standards and methods. On June 15, 2022, updated basket weights for the goods and services used in the calculation of the CPI will be made available in table 18-10-0007-01. The new basket weight reference period will be 2021, based on the most recent national household final consumption expenditure data. Alternative data for 2021 will be used to account for pandemic-related shifts at more detailed levels of geography and within the various CPI components.

One week later, on June 22, the May 2022 CPI will be released, based on the updated basket weights.

For general information on basket updates, consult The Canadian Consumer Price Index Reference Paper, chapter 8, "Weights and basket updates."

For the latest analysis of evolving consumer expenditure patterns during the pandemic recovery, see the adjusted price index, which has provided a complementary measure of consumer price inflation based on a more timely set of national weights from alternative sources of expenditure data, such as those from the Bank of Canada. Going forward, and to ensure an even greater degree of relevance, Statistics Canada will move towards annual basket updates based on the most recent household expenditure data.