The publication of consumer inflation figures by Statistics SA yesterday included a new addition: a consumer price index (CPI) for administered and regulated prices.
An administered price is defined as the price of a product or service that is set consciously by an individual producer or group of producers, and/or can be determined or influenced by the government, without reference to market forces.
Regulated prices are those administered prices that are monitored and controlled by government policy. Administered price inflation at September (that is, the CPI for administered prices in the historical metropolitan areas at September 2005 compared with that at September 2004) was 11.8 percent.
This was 0.5 percentage points lower than the annual rate of 12.3 percent at August. The annual administered price CPIX at September (that is the CPI excluding mortgages for administered prices at September 2005 compared with September 2004) rose at a rate of 10.3 percent. This rate was 0.9 percentage points lower than the rate of 11.2 percent at August.
Specialist users of statistics often require considerably more detail than generalists who use statistics for a broad understanding of the issues of the day.
Indices measuring inflation, or changes in prices, provide a good example of this distinction. Monthly data collected on consumer prices allow for the calculation of a number of indices.
The CPIX, which is the CPI excluding the interest rate on mortgage bonds, for the historical metropolitan and other urban areas.
Various price indices for different geographical areas. It is sometimes difficult for non-specialists to interpret the importance and relevance of this wide range of indices and the significance of differences between them.
For this reason, Stats SA tends to emphasise certain price indices over others, at least in its high-level or executive summaries.
One of the core price indicators is the official inflation rate, which is also known as headline inflation. This records the percentage change in CPI for the historical metropolitan areas from one period to another.
As at September, headline inflation was 4.4 percent (that is, the difference between CPI in urban areas at September 2005 and at September 2004). From August to September, there was an increase of 0.4 percent in the CPI. An increase in the price indices for transport was the most significant factor in this.
A second key indicator is the annual percentage change in the CPIX, which is the CPI excluding the interest rate on mortgage bonds, for the historical metropolitan and other urban areas.
The Reserve Bank's inflation target is to keep the annual rise in CPIX between 3 percent and 6 percent. As at September, this was reported at 4.7 percent, when compared with September 2004.
A third important indicator is food inflation, or the annual rate of increase in food prices for the historical metropolitan areas. This was 3.4 percent at September (that is, the CPI for food at September 2005 compared with that at September 2004), which is 0.8 percentage points higher than the corresponding annual rate of 2.6 percent at August.
The inflation rate for rural areas was lower than official or headline inflation, coming in at 3.2 percent at September (that is, the rural CPI at September 2005 compared with that at September 2004), 0.1 percentage points lower than the corresponding annual rate of 3.3 percent at August.
For the total country, the CPI at September was 4 percent higher than at September 2004, or 0.3 percentage points higher than the corresponding annual rate of 3.7 percent at August.
Economic measurement lies at the centre of most current debates on national policy: growth, job creation, social grants, poverty alleviation, interest rates and currency levels.
While policy specialists and economic analysts often work with a wide range of indices and measures, non-specialists necessarily focus on a narrow but consistent range of indicators to inform them about development and change in the economy.