interactive investor comments on the latest Office for National Statistics inflation basket of goods.
Commenting, Myron Jobson, Senior Personal Finance Analyst, interactive investor, says: “The latest inflation basket reflects a changing market - one that is both increasingly technologically savvy and health conscious it seems with e-bikes, home security cameras, soundbars and frozen berries among the new additions.
“A printer has also been added as a standalone item to improve the ONS’ coverage of data processing equipment, which it said is under-represented in the inflation basket. The humble home printer found itself newly appreciated alongside other must-have items such as toilet rolls and home baking supplies during the pandemic thanks to lockdowns and home schooling. The shift towards flexible working post-pandemic bodes well for demand of these products.
“The items that have been removed are also telling. Gone are non-chart CDs following a decline in sales as streaming asserts its dominance over the music industry. Alcopops, low alcohol and typically brightly coloured drinks have also fizzled out, and the basket also says goodbye to digital compact cameras, which have been reeled aside with smartphone cameras now sophisticated enough to rival these products.
“As habits change, what is counted as ‘everyday’ has evolved. The ONS basket of goods become ever more diverse, with the inclusion of products that some of us wouldn’t even dream of buying. Items enter the basket for various reasons, with some making the statisticians’ shopping list because of consumer popularity, or simply to diversify the range of products for already established items.
“It is not an exact science, and its variety should remind us that the experiences of the rising cost of living is unique to each individual. While headline inflation is cooling, the improvements needed for Britons to feel good about where inflation is heading are yet to be seen. Most of us are feeling the force of inflation on our finances most through our spending on groceries and energy bills.
“We all have our own inflation number, and it is worth keeping tabs on your spending habits to get a better idea of the goods and services that are eating most into your budget, and where you could cut back.”
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