CHICAGO – Numerator projects the Consumer Price Index for everyday consumer purchases – such as food at home, alcoholic beverages at home, limited service restaurants (fast food), housekeeping supplies, toys, pet products, and sporting goods – slowed to 0.3% month-over-month in March, compared with 0.4% month-over-month in February.
Numerator, a data and technology company providing insights into consumer behavior, has released its Monthly Inflation Report, an advance projection of the US Bureau of Labor Statistics’ monthly Consumer Price Index (CPI) for everyday consumer purchases. The report measures inflation for retail items consumers tend to buy frequently, including food at home, alcoholic beverages at home, limited service meals and snacks (fast food), housekeeping supplies, toys, pet products, and sporting goods. Currently, Numerator’s Monthly Inflation Report measures approximately 14% of the CPI basket.
As shown in Table 1, seasonally adjusted prices for the everyday consumer purchases that Numerator tracks increased 0.3% month-over-month in March. Seasonally adjusted prices for all food at home purchases increased 0.1% month-over-month in March, a modest deceleration from the 0.3% increase in February. For the major categories of food at home, in March, seasonally adjusted prices for cereals and bakery products increased 0.7%, prices for meats, poultry, fish, and eggs decreased 1.4%, prices for dairy and related products decreased 0.3%, prices for fruits and vegetables decreased 0.4%, prices for nonalcoholic beverage and beverage materials increased 0.6%, and prices for other food at home increased 0.6%. For the other categories aside from food at home that Numerator tracks, prices for alcoholic beverages at home decreased 0.1%, prices for limited service meals and snacks (fast food) increased 0.6%, prices for housekeeping supplies increased 0.8%, prices for toys decreased 0.4%, prices for pet products increased 0.5%, and prices for sporting goods increased 0.7%.
On a year-over-year basis, between March 2022 and March 2023, prices for all the categories of everyday consumer purchases that Numerator tracks increased 7.5%. Prices for food at home increased 8.0% overall, prices for cereals and bakery products increased 12.0%, prices for meats, poultry, fish, and eggs increased 3.9%, prices for dairy and related products increased 9.7%, prices for fruits and vegetables increased 3.5%, prices for nonalcoholic beverages and beverage materials increased 10.5%, and prices for other food at home increased 9.9%. For the other categories aside from food at home that Numerator tracks, between March 2022 and March 2023, prices for alcoholic beverages at home increased 3.7%, prices for limited service meals and snacks (fast food) increased 7.5%, prices for housekeeping supplies increased 9.7%, prices for toys increased 1.2%, prices for pet products increased 9.1%, and prices for sporting goods increased 2.4%. (For additional details, please see Table 2 at the end of this report).
Table 1: Change in Consumer Price Index, by expenditure category, March 2023
The Numerator Inflation Report is produced and published monthly under the leadership of Numerator Chief Economist, Dr. Leo Feler. The report uses Numerator’s first-party and real-time consumer data, aligned with the methodology the US Bureau of Labor Statistics uses to calculate the CPI to produce a projection of the CPI ahead of the CPI’s official monthly release.
METHODOLOGY AND COMPARISON TO CPI
Numerator collects price and quantity data directly from over 1 million US households each month and selects qualifying households to construct a representative panel of 150,000 US consumers. These consumers upload images of paper receipts and link their loyalty and email accounts, providing access to their detailed purchase information on a continuous basis. From this purchase information, Numerator knows the prices consumers pay for over 4 million items purchased throughout the US each month.
In contrast, the US Bureau of Labor Statistics obtains price information for the CPI based on a static survey of 24,000 households regarding their consumption patterns during a prior year and then has government surveyors visit retail establishments to scan items or scrape retailers’ websites to obtain prices on approximately 80,000 items that these 24,000 households tended to buy when they were surveyed.
Numerator data captures the prices a representative panel of 150,000 US consumers pay for items they actually buy in real-time during a given month, whereas the CPI captures prices for a basket of goods selected based on the likelihood that a sample of 24,000 households bought those items in a prior year. The inflation consumers actually experience – which is what Numerator captures – is different than the inflation the CPI reports. For example, if consumers encounter an item that is out-of-stock and have to substitute to higher-priced items, their “experienced inflation” might be greater than the inflation the CPI reports. Alternatively, if a consumer adapts their shopping behavior by buying in bulk or substituting to lower-priced items, their “experienced inflation” might be lower than the inflation the CPI reports.
For now, Numerator attempts to replicate the methodology the US Bureau of Labor Statistics uses to construct the CPI; however, Numerator also has a more detailed view on how consumers adapt to inflation. Since the US Bureau of Labor Statistics does not observe consumer purchases in real-time, its measure of consumer price inflation cannot account for changes in consumer behavior. In contrast, Numerator can evaluate how different segments of the population experience inflation, depending, for example, on the density of retailers and competition among retailers in the areas where consumers live, whether consumers have memberships to certain retailers (e.g., club memberships), and whether consumers have access to broadband and transportation to be able to shop among a broader set of retailers.
Because of the differences in how Numerator and the US Bureau of Labor Statistics collect price data, the Numerator Inflation Report may differ from the US Bureau of Labor Statistics’ monthly CPI release. These differences are attributable to methodology. To have its monthly inflation report approximate the CPI, Numerator must control for changes in consumer behavior in an attempt to keep purchasing behavior constant. Additionally, Numerator collects price data over the course of an entire month, whereas the US Bureau of Labor Statistics collects price data for each product in its sample only at specific points in time during the month. These two methodological differences – the fact that Numerator also captures changes in consumer behavior in response to price changes and the fact that Numerator captures price data over the course of an entire month on a continuous basis – account for the differences in reported inflation between the Numerator Inflation Report and the US Bureau of Labor Statistics’ monthly CPI release.
ABOUT NUMERATOR
Numerator is a data and technology company bringing speed and scale to consumer research. Numerator blends first-party data from over 1 million US households with advanced technology to provide insights into consumer behavior. Headquartered in Chicago, Illinois, Numerator has over 2,000 employees worldwide, and 80 of the top 100 CPG brands are Numerator clients.
DISCLAIMER
The Numerator Inflation Report has been prepared for informational purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this report is not intended to provide, and should not be relied upon for, financial advice, investment advice, trading advice, or any other advice. Numerator shall have no liability to any person or entity for any loss or damage resulting from the use of or reliance on the above-mentioned information.
Table 2: Change in Consumer Price Index, by detailed expenditure category, March 2023
Table 2 – Continued: Change in Consumer Price Index, by detailed expenditure category,
March 2023
