Machinery and Equipment Price Index (MEPI)

Detailed information for second quarter 2006





Record number:


The Machinery and Equipment Price Index (MEPI), provides quarterly estimates of price changes for machinery and equipment purchases, relative to annual gross additions to capital by Canadian Industry of purchase.

Data release - August 17, 2006


The Machinery and Equipment Price Index (MEPI), provides quarterly estimates of price changes for machinery and equipment purchases, relative to annual gross additions to capital by Canadian Industry of purchase. The MEPI is used by the Canadian System of National Accounts to calculate constant price estimates of final demand purchases of capitalized machinery and equipment, through the deflation process.

As an economic indicator, the MEPI provides information on the changing costs of capital investment by Canadian purchasers. This information is organized from both the industry and commodity perspectives. In addition, the MEPI tracks these price movements on a domestic and imported basis.

Reference period: The time period for which the MEPI equals 100; currently this is the year 1997.

Collection period: For most products, the collection process occurs on a monthly basis.


  • Machinery and equipment price indexes
  • Prices and price indexes

Data sources and methodology

Target population

The universe for the MEPI consists of all manufacturers and distributors of machinery and equipment purchased in Canada.

Instrument design

Commodity specialists collect price data through the form of mail-out price reports, which contain technical descriptions and specifications for the selected products, originally supplied by the respondent. In addition to the product description, the report outlines the terms of sale.


This is a sample survey with a longitudinal design.

The sampling frame for the MEPI is based on the survey frame available from the Annual Survey of Manufacturers and Logging (ASML). The Most common survey unit is the "establishment", which is the smallest unit of an organization that can provide the basic data required for industry statistics, most commonly an individual plant.

Data sources

Responding to this survey is mandatory.

Data are collected directly from survey respondents and derived from other Statistics Canada surveys.

The prices of most of the commodities surveyed for the MEPI are collected monthly, usually over a three-week period. Commodities for which price change occurs less frequently are surveyed at other intervals (e.g. quarterly). For the import component of the MEPI, producer price indexes published by the U.S. Bureau of Labor Statistics are employed.

In the cases where, for a particular commodity, there are no prices collected due to either an insignificant level of production, or a lack of respondent co-operation, proxy series are constructed. Proxy series may consist of a combination of several other reported series, or use similar representative price indexes from other programs or agencies (IPPI and the U. S. Bureau of Labor Statistics are the most common sources).

View the Questionnaire(s) and reporting guide(s) .

Error detection

In the normal collection and processing of these indexes, great emphasis is placed on the examination and evaluation of prices. Commodity specialists monitor developments in the markets. They review the behavior of the reported price changes, both to validate them directly and to ensure they are representative of the product price movement as a whole.

Outliers and incorrect or suspicious prices are identified during the initial data processing and then verbal follow-ups are conducted with the respondents, to ensure that the correct information has been obtained.


Missing data is generally estimated by an imputation process. In any given period, there will be price reports that are missing, due to the fact that respondents are late reporting. In this situation, either the last reported price quotation will be carried forward, or an estimate will be made based on other information (e.g. using other responses as a proxy).



The weights used in the MEPI represent shares of capital investment by industry for year 1997, valued at 1997 purchaser prices. The weights are derived from the Final Demand matrix of the Input-Output Table, compiled by the Canadian System of National Accounts (Input-Output Structure of the Canadian Economy in Current Prices, record number 1401).

The original source of the data is the survey Capital and Repair Expenditures, Actual, Preliminary Actual and Intentions (record number 2803).

The prices used for domestic machinery and equipment (manufactured in Canada) are manufacturer's selling prices f.o.b. plant on new orders in the middle of the month. The prices for imported machinery and equipment are represented by the U.S. Bureau of Labor Statistics producer price indexes, adjusted for changes in the exchange rate and custom tariffs. Domestic and foreign price indexes are adjusted for any changes to the effective rate of the goods and services tax (GST) since 1991.

Quality evaluation

The statistical accuracy of the MEPI depends on price data and weight information. Price data are obtained from a sample survey and other statistical sources, while the weights are estimated from the Input-Output Table (Input-Output Structure of the Canadian Economy in Current Prices (survey number 1401). Both kinds of input data are subject to their own errors.

Disclosure control

Statistics Canada is prohibited by law from releasing any information it collects which could identify any person, business, or organization, unless consent has been given by the respondent or as permitted by the Statistics Act. Various confidentiality rules are applied to all data that are released or published to prevent the publication or disclosure of any information deemed confidential. If necessary, data are suppressed to prevent direct or residual disclosure of identifiable data.

Collected data are converted to price indexes and data are released as such, so that it is not possible to identify the suppliers of raw prices.

Revisions and seasonal adjustment

The MEPI allows the comparison in percentage terms, of prices in any given time period to prices in the base period, currently 1997=100.

The most recent 4 quarters of the MEPI are subject to revision.

Data accuracy

Though the MEPI uses a sample survey methodology to obtain the necessary data, confidence levels are not currently estimated, due to the longitudinal nature of price index series. Indexes for all levels of aggregation are considered to be statistically reliable.

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