Eurostat experts approve the methods of inflation calculation
In the summer of this year the representatives from the Eurostat inspected if Latvia harmonized consumer price index (HCPI) meet the requirements of the set methodology, European Union (EU) guidelines and standards of good practice in the calculation of consumer price index. According to the evaluation of the Eurostat experts the methods used for the Latvia HCPI calculations generally correspond to the set criteria. The experts also positively evaluated the activities of last years made for the improvement of the quality of the consumer price statistics. During the testing in the HCPI methodology there were not found any important inadequacies. The calculation data of the Latvia HCPI have passed all HCPI mathematical tests and they are structurally seriated, and show correct result. Latvia HCPI is comparable with HCPI of other European Union countries.
As we informed previously, before the EU accession the Central Statistical Bureau cooperated with the experts from Eurostat and other international institutions and has successfully realized several activities to introduce the Latvia HCPI.
While the representation of HCPI regarding the preciseness and veracity of the data generally is appropriate, the quality of Latvia HCPI can be improved, if the analysis and improvement of used methods is continued, especially to observe the price changes for the rent of dwellings and used transport vehicles.
HCPI is indicator established to compare the average consumer price level among the EU countries. HCPI basically is calculated by the same method as national consumer price index (CPI). Compared to CPI, what is the general measurement of inflation in our country, the HCPI has slightly different definition of population coverage, because the expenditure structure of HCPI includes also the foreign tourist expenditure in our country. According to that, the observation and conclusions of the Eurostat experts regarding the HCPI correspondence to the methodology can be fully related also to the CPI.
It is possible to find complete report in the Eurostat Website on Internet http://epp.eurostat.ec.europa.eu/pls/portal/docs/PAGE/PGP_DS_HICP/TAB61582098/04%20METH-HICP%20CM%20-%20LATVIA%202007-07.PDF
Prepared by Consumer Price Indices Section