As stated yesterday (29 September 2016) in the Statistics Iceland’s news release on the consumer price index in September, the rise in cost of owner occupied housing (imputed rent) is partially due to a correction of the sub index. Statistics Iceland regards this as a serious incident.

From March 2016 to September 2016 imputed rent was underestimated. This has now been corrected. The correction is due to a mistake which delayed price changes in imputed rent by one month.

The effect of the change did not accumulate but the price change of imputed rent affected the index with a one month delay. Without the error the monthly consumer price index change would have been 0.21% for September instead of 0.48%. The difference is 0.27 percentage points. The effect on the general public is expected to be miniscule as well as the impact on borrowers.

Statistics Iceland reacts by correcting the sub index and informing users as quickly as possible.  Users were informed when the consumer price index for September was published. Data is corrected in one step while earlier figures will not be corrected. Hence, retroactive changes in the index are excluded.

Statistics Iceland regrets the mistake and will do the utmost to prevent such mistakes to occur again. Statistics Iceland will review work processes regarding the consumer price index and revise them where needed.