METAC / IMF price statistics mission October 12-28, 2008 New estimates for the national CPI Kari Manninen EconAdvisor

Revised national CPI estimates Base prices of 2005 Still old weights ◦ Could apply new weights at 4-digit level ◦ Not a massive effect The average annual inflation

Headline CPI

Comparison to the old series Incomplete No recalculated series for 2000 – 2005

Annual inflation

* 8 month average

Annual inflation * 12 months average

New and old official inflation

Options Do not revise Revise national only from 2005 onwards Compile new index based on new methodology, weights from 05, 06, 07, or 08 onwards New CPI 2008 = 100 ◦ New weights ◦ Geomean ◦ Linking 2008 old prices to the index

Lessons from the analysis More frequent price collection! Better item specifications! Seasonal products Better data validation CPI Publication ◦ National index the priority ◦ Regional indices fairly unreliable ◦ Contributions

Users and revision Concerted revision with National Accounts! Users need to be informed – How? ◦ Central bank ◦ Ministry of Finance, Planning ◦ Private banking Policy implication! ◦ Monetary policy ◦ Salaries ◦ Pensions ◦ Contract escalation