Video streaming services (such as Amazon Instant Video or Netflix) have been added to the Consumer Prices Index (CPI), as part of the annual review of the CPI basket of goods and services.
As well as updating the contents of the basket, ONS also reviews and updates the weighting attached to each item so that the CPI reflects current consumer spending as closely as possible. ONS uses many sources to do this, including the Living Costs and Food Survey and the Monthly Business Survey – Retail Sales Index. For example, household fuels now account for a much larger proportion of people’s living costs than a decade ago.
Video streaming services are being added as part of a combined DVD rental/video on demand subscription services item to reflect the trend of consumers turning more to downloads for watching films and TV programmes. The combined item replaces DVD rental internet subscriptions.
Other new additions include flavoured milk, mixer drinks, fruit snack pots and honey, which have been added to the food and non-alcoholic drinks section of the basket. Meanwhile, men’s clothing hire, canvas shoes and necklaces have been added to the clothing and jewellery sections.
Digital cameras with interchangeable lenses (such as digital single lens reflex – DSLR – cameras) are also being added. With the decrease in purchases of traditional compact digital cameras, they now make up about half of consumer spending on cameras.
Hardwood flooring has been removed from the basket, as spending on this has fallen in recent years. In addition, DVD recorders have been removed as consumers have turned to different methods to catch up on missed TV programmes, such as online catch up players and personal video recorders (PVRs).
There are currently 699 items that make up the CPI basket of goods and services, of which 14 are new this year, with nine other items being removed, and 25 being modified.
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