The government reported that gasoline prices in April were down 2 percent
when "seasonally adjusted." How could this be, when we know
prices went up at the pump?
Here's how it happened:
1) The actual increase in
gasoline prices was 5.6%.
2) But the government
statistics indicate that gasoline tends to rise by 7.6% in April.
3) But because they rose
less than that--5.6%--gasoline was reported to be down 2 percent
"seasonally adjusted"
It has to do with the
phrase "seasonally adjusted." The government adjusts numbers to
remove the impact of regular events that occur at the same time every
year--like increases in gas prices in April, or the effect of cold weather
on housing starts.
There is nothing
nefarious about this--the question is whether the "adjustments"
are fair and accurate.