The purpose of the consumer price index is to measure the development of the prices charged to consumers for goods and services bought by private households in Denmark. The consumer price index has been calculated since 1914, but there are estimated figures for the development in consumer prices back to 1872. From January 1967 the index has been calculated on a monthly basis.
The consumer price index shows the development of prices for goods and services bought by private households in Denmark. Thus, the index also covers foreign households' consumption expenditure in Denmark, but not Danish households' consumption expenditure abroad. The index shows the monthly changes in the costs of buying a fixed basket of goods, the composition of which is made up in accordance with the households' consumption of goods and services. The consumer price indices divided by group of households show the price development for different households.
The price indices for April, May, June, July, August, September, October, November and December 2020 are more uncertain than usual, as the non-response rate has been significantly larger than normal and some businesses have been shut down due to Covid-19.
The consumer price index is calculated on the basis of 23,000 prices collected from approx. 1,600 shops, companies and institutions throughout Denmark. Most prices are by far collected monthly. The data material received is examined for errors, both by computer (using the so called HB-method) and manually. The different goods and services, which are included in the consumer price index, are first grouped according to approx. 500 elementary aggregates for which elementary aggregate indices are calculated. The elementary aggregate indices are weighted together into sub-indices that are in turn aggregated into the total consumer price index. In calculating a price index it is assumed that the baskets of goods that are compared are identical, also with respect to the quality of the goods. Mainly indirect quality adjustment methods are being applied in the consumer price index in connection with changes in the sample.
The consumer price index is generally viewed as a reliable statistic based on the views of users.
Important users are among others the Ministry of Finance, The Ministry of Economic Affairs and the Interior, The Danish Central Bank and private banks and other financial organizations.
No calculation has been made of the uncertainty connected with sampling in the consumer price index as the sample is not randomly drawn, but the quality of the consumer price index is accessed to be high.
In addition to the "general" uncertainty connected with sampling, there are a number of sources of potential bias in the consumer price index. One source is the consumers substitution between goods and shops and another source is changes in the sample (se chapter regarding "Non-sampling error").
The consumer price index is published on the 10th or the first working day thereafter, following the month in which the data was collected.
The statistics are published without delay in relation to the scheduled date.
The consumer price indices divided by group of households are published once a year.
The consumer price index is related to the European Union harmonized consumer price index (HICP) and to the index of net retail prices. From January 2001, the only difference between the national consumer price index and the HICP is the coverage of goods and services, as owner-occupied dwellings is only recorded in the consumer price index and not in the HICP. The consumer price index is also related to the index of net retail prices. The two indices comprise the same groups of goods and services and are calculated according to the same methodology. Consequently, the only difference between the two indices is the price concept used, as indirect taxes and VAT are subtracted in the index of net retail prices, and the weighting.
These statistics are published monthly in a Danish press release and in the StatBank under Consumer Price Index.