Out goes hand sanitiser, in comes vinyl...
The Office for National Statistics (ONS) has been sorting through its inflation shopping basket.
The Office for National Statistics (ONS) has been sorting through its inflation shopping basket.
Every year in March, the ONS announces the results of a review of the approximately 750 items which it uses to compute inflation indices, such as the Consumer Price Index (CPI). The annual review is a reminder that the calculation of inflation is not a simple exercise: our spending habits – what we buy and stop buying – evolve alongside changing prices.
The 2024 revision saw 16 items added to the shopping basket and 15 ejected. Among the more interesting changes were:
In
Out
As well as shuffling the basket’s contents, the ONS has also changed the weights given to each of its 12 divisions of goods and/or services, based on average expenditure in 2022. This explains why inflation numbers might differ from your own experience, because your spending patterns might not match ONS weightings. For example, the largest single category, accounting for 14.5% of the CPI, is restaurants and hotels, closely followed at 14.3% by recreation and culture. Food comes in fifth position at 11.3%.
While inflation is expected to fall this year, it will remain a fact of life and one that needs to be factored into any financial planning.
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