Tuesday, March 19, 2013
Inflation - take your choice
Posted by David Smith at 01:00 PM
Category: Thoughts and responses

Inflation edged up from 2.7% to 2.8% last month, or rather it did on one measure, the consumer prices index. The 2.8% rate in February was the highest for nine months and pushed up by gas and electricity bills, petrol and diesel and air fares. It may go higher in the coming months.

On another measure, the new CPIH, consumer prices including housing (owner-occupiers) costs, inflation also edged up, from 2.5% to 2.6%. Keep an eye on CPIH - it may eventually evolve into a new target measure of inflation.

What about the retail prices index? The RPI is now so poorly regarded by the Office for National Statistics that it is no longer designated as an official statistic, though it will continue to be published. It actually edged down last month, from 3.3% to 3.2%.

The ONS prefers its new measure, RPIJ, using the Jevons method of calculation. It showed an inflation rate of 2.6% last month, from 2.7% in January. More here.