Muffins and mp3 players to be included in inflation calculation

Muffins, mp3 players and fruit smoothies are to be included in the methodology for calculating future rates of inflation, the Office of National Statistics (ONS) has announced.

The ONS has included the goods in its annual update to its shopping basket – which contains 650 widespread goods and services – and acts as a way of gauging the Retail Prices Index (RPI) by reflecting public spending habits.

Speaking to the Times, Jeffrey Young, managing director of Allegra Strategies, the consultancy, said: “Innocent is now one of the top 100 food brands in the UK and it’s come from nowhere. It shows how popular smoothies have become.”

According to new figures from the Consumer Price Index (CPI) for the Office of National Statistics (ONS), utility tariffs increased by 0.7 per cent during last month.

This rise takes the annual rate to 2.5 per cent, more than the 2.2 per cent recorded in January and 0.5 per cent higher than the government’s two per cent target.

Tags: National Statistics, allegra strategies, cent target, spending habits, Office of National Statistics, Retail Prices

Savers are short-sighted

Millions of consumers are only saving money to achieve their short-term goals, new research has indicated.

An estimated 7.5 million Britons save cash just to meet their immediate needs, according to a report by website Unbiased.co.uk.

A further 3.8 million are thought to be “frivolous” spenders, driven to part with their cash because of their desire to acquire certain purchases, rather than their ability to afford them, according to the study.

The report, commissioned by IFA Promotion and based on official data and a YouGov survey of consumers, concludes that there are two frivolous spenders for every Briton who is financially aware.

Dividing the nation into five categories according to their spending habits, the study also suggests that even one in ten “bargain” spenders do not have any savings.

“This year’s research into the nation’s propensity to save shows some improvement, but it is disappointing that we still define ourselves as a nation of spenders rather than a nation of savers,” said Unbiased.co.uk chief executive David Elms.

News that many Britons are failing to save for a rainy day follows research published yesterday indicating that the majority of the nation’s wealth is now tied up in property rather than traditional financial assets such as savings.

Some 55 per cent of the UK’s wealth is now linked to equity in properties, the study commissioned by the insurer Prudential found.

Tags: spending habits, propensity, money, United Kingdom, year, insurer, rainy day, property