RDP 2006-11: Component-smoothed Inflation: Estimating the Persistent Component of Inflation in Real Time Appendix A: Smoothing of Selected CPI Components

Christian Gillitzer and John Simon

December 2006

Table A1: Australia
CPI components with lowest and highest α coefficients
12 items with lowest α coefficients α(a) Variance(b) CPI weight(a)
Fruit 0.21 150.62 1.80
Vegetables 0.22 65.45 1.20
Automotive fuel 0.28 19.07 4.45
Overseas holiday travel and accommodation 0.29 13.12 1.78
Gas and other household fuels 0.34 6.42 0.71
Lamb and mutton, sa 0.35 9.46 0.26
Children's footwear 0.40 2.84 0.11
Glassware, tableware and household utensils 0.42 5.92 0.45
Children's and infants' clothing 0.43 5.16 0.38
Tea, coffee and food drinks 0.44 5.80 0.25
Childcare 0.46 7.08 0.50
Hospital and medical services(c) 0.51 3.42 2.79
12 items with highest α coefficients
Sports participation 0.95 0.27 0.73
Pet services including veterinary 0.96 0.18 0.44
Newspapers and magazines 0.96 0.43 0.40
Dental services, sa 0.96 0.13 0.69
Preschool and primary education, sa 0.97 0.16 0.55
Water and sewerage, sa 0.98 0.30 0.80
Other recreational activities, sa 0.98 0.30 1.10
House purchase 0.98 0.44 7.79
Other household services 0.98 0.48 0.61
Property rates and charges, sa 0.99 0.19 1.18
Rents 1.00 0.06 5.17
Secondary education, sa 1.00 0.02 0.98

Notes: (a) For 2006:Q3. All data are adjusted for the tax changes of 1999–2000.
(b) Variance in percentage points of quarterly percentage changes over the period 1993:Q1–2006:Q3.
(c) Adjusted for major health policy changes.

Table A2: United States
CPI components with lowest and highest α coefficients
12 items with lowest α coefficients α(a) Variance(b) CPI weight(a)
Motor fuel 0.09 27.31 4.63
Fresh vegetables 0.09 7.81 0.49
Fuel oil and other fuels 0.11 19.57 0.38
Eggs 0.15 10.42 0.09
Tobacco and smoking products 0.22 7.63 0.71
Fresh fruits 0.22 2.25 0.50
Public transportation 0.35 1.06 1.09
Girls' apparel 0.37 2.27 0.23
Boys' apparel 0.38 1.84 0.19
Infants' and toddlers' apparel 0.38 0.85 0.18
Jewelry and watches 0.38 1.22 0.32
Beef and veal 0.40 1.32 0.63
12 items with highest α coefficients
Personal care services 0.94 0.05 0.67
Motor vehicle insurance 0.95 0.12 2.26
Prescription drugs and medical supplies 0.95 0.04 1.03
Miscellaneous personal services 0.95 0.02 1.18
Hospital and related services 0.96 0.06 1.62
Tuition, other school fees, and childcare 0.97 0.02 2.84
Motor vehicle maintenance and repair 0.98 0.03 1.14
Water and sewer and trash collection services 0.98 0.03 0.89
Professional services 0.98 0.02 2.80
Owners' equivalent rent of primary residence 0.99 0.01 23.66
Rent of primary residence 0.99 0.01 5.87
Food away from home 0.99 0.01 5.95
Notes: (a) For 2006:M10. CPI components have been seasonally adjusted using Census X12 where appropriate.
(b) Variance in percentage points of monthly percentage changes over the period 1987:M1–2006:M10.