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Smartphones added to inflation basket

by Sarah Griffiths on 15 March 2011, 14:31

Tags: General Business

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Mobile apps and smartphones are being used for the first time to calculate inflation.

The two techie favourites are among a new raft of products added to the Office for National Statistics' (ONS) inflation basket to understand people's spending habits, the BBC reported.

The ONS reportedly revamps its basket of 650 services and products every year and in 2011 will be interested particularly in why consumer inflation is currently running at 4 percent instead of the Bank of England's target of 2 percent.

It is believed the new entries into the basket and those thrown out reflect consumers' shopping choices as well as what technology is currently popular.

The ONS apparently collects 180,000 price quotes for items in the basket, which are used to work out the Consumer prices Index (CPI) and Retail prices Index (RPI), which show the level of inflation.

New entries into the basket reportedly include: smartphone handsets, mobile apps, dating agency fees, hair conditioner, dried fruit, oven-ready joints, sparkling wine, MDF and craft kit.

Meanwhile, mobile phone downloads, vending machine cigarettes, rose bushes, pork shoulders, hardboard and bizarrely vet fees for spaying a kitten, have all apparentlybeen ousted.

The shift from mobile downloads like ringtones and wallpaper to paid-for apps shows the shifting trends in technology use.

"Powerful smart phones and the applications that run on them have become essential for many when communicating or seeking information. Likewise, increasing numbers of people now seek a partner via internet dating sites," ONS statistician Phil Gooding reportedly said.



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