Virtual reality headsets and pre-cooked pulled pork have joined the list of products used to measure UK inflation while newspaper adverts have been dropped, reflecting the shift in spending habits towards online commerce and convenience options.
In its annual update to the basket of goods and services that tracks price growth, the Office for National Statistics added 23 new items to the list of more than 700 deemed representative of what consumers typically spend money on, and removed 15.
The UK statistics agency said on Tuesday that spending on VR headsets had soared in recent years. By contrast, newspaper adverts have become less common as businesses turn to social media.
Stephen Burgess, ONS deputy director for prices, said the addition of VR headsets to the inflation basket pointed to Britons’ “appetite for emerging technology, while the loss of printed newspaper adverts demonstrates a continuing shift towards the online world”.
“Desire for convenience amid our busy lifestyles also plays a part in this year’s basket changes,” he added, with pre-cooked pulled pork replacing oven-ready gammon pork joints as consumers turn to products that take less time to prepare. Ready-to-use noodles and mangos also joined the new basket.
Separately, the agency has changed how it tracks overnight hotel accommodation. At present, hotel inflation is based on prices for the next night, making it one of the most volatile components of the entire basket.
But in the new basket hotel costs will also reflect prices further in advance, reducing the impact of short-term demand pressures.
The average cost of a one-night hotel stay surged by an annual rate of 20 per cent in June 2024 but dropped to just 4 per cent in the following month, raising questions about the inflationary impact of US pop star Taylor Swift’s Eras tour.
Annual consumer price inflation rose more than expected to 3 per cent in January, up from a low of 1.7 per cent in September last year but well below the 41-year high of 11.1 per cent recorded in October 2022.
The surge in price growth in 2022 reflected the big rise in energy and food prices after Russia’s full-scale invasion of Ukraine in February that year.
The Bank of England expects inflation to rise to 3.7 per cent by mid-2025, before it falls towards its 2 per cent target rate later in the year.
The ONS also added exercise mats to the basket, noting that use of the product had “increased considerably” since the pandemic, when more people took to working out at home.
Other additions include men’s sliders, which have become a rapidly growing area of the footwear market.
But meals at in-store cafeterias, including in department stores, were dropped because “the prevalence of these outlets has dropped with many store closures”, the agency said.
The changes to the basket will take effect with February’s inflation data, which will be published by the ONS on March 26.
