Royal Statistical Society CEO: ‘We’re not seeing the full picture’ on inflation with CPI

The consumer prices index (CPI) rose by 3.9% in the 12 months to November, down from 4.6% in October, according to figures from the Office of National Statistics published yesterday ( 20^th December) – the lowest rate recorded since September 2021, and a larger drop than anticipated by economists.

In a statement published in response to the latest figures, Sarah Cumbers, chief executive at RSS, encouraged policymakers to consider looking at Household Cost Indices, published by ONS, to better understand how inflation affects people.

Cumbers said: “With people continuing to bear the brunt of the cost of living crisis in the run up to Christmas, we should remember that CPI was never intended to measure households’ experiences of inflation.

“Its exclusion of interest payments such as mortgages and loan payments – and the greater weight it gives to higher spend households – means we’re not seeing the full picture. As more people come off low fixed rate mortgage interest deals, and people borrow for Christmas, a wider group of households will be impacted.
 
“I would encourage policymakers to take into account the Household Cost Indices, now published quarterly by ONS, as the best way to understand people’s experiences of inflation, particularly those on lower incomes.”

The consumer price indices measure changes in the cost of goods and services, and are typically based on prices collected from outlets around the UK, supplemented by data collected over the internet and by phone. The figures in the latest ONS publication used data collected on or around 14th November.