CPI FALLS to 4%

Graham_Devon

blueboy43 wrote: »

FLIGHTS HAVE NOT FALLEN IN PRICE !!!!!!!

"air transport, where fares rose by less than a year ago, particularly on European routes".

As an example;

If the inflation figures comprised only of flights which had risen by 8% in the year to March 2010, the March 2010 CPI would be 8%.

If this year (to March 2011) they have only risen by 4%, then the CPI will be 4%.

Why has the CPI rate fallen from 8% to 4% - BECAUSE FLIGHTS HAVE NOT RISEN BY AS MUCH.


(sorry for the CAPS )

Jesus. All I'm saying is I'm surprised.

Another example is thomas cook adding fuel surcharges to their holidays.

All I'm saying is I'm surprised by the flights data, much like economists are surprised by the fall overall.

Radiantsoul

DervProf wrote: »

Here's the problem with inflation. Eveyone will be pleased that inflation looks like it might be starting to fall.

However -

Inflation is still above target (and above rises in income for most people)

Even if inflation eventually hits 2% or less, the effects of recent higher inflation will stay with us - things will cost more than they would have done.

So what?
the cost of inflation is the uncertainty, short-termism and inequality it generates. I am not sure any given price level or more or less defendable than any other.

artha

nicko33 wrote: »

http://www.statistics.gov.uk/cci/nugget.asp?ID=19

The most notable contributions came from fruit where prices fell by 4.7 per cent this year (also a record February to March movement) but rose by 0.7 per cent a year ago, and bread and cereals where prices fell by a record 2.6 per cent this year compared with a fall of 0.2 per cent a year ago.

Good news for pensioners?

As a retiree who keeps a regular check on food prices I'm amazed by the statements on food price decreases. As a limited example, the small wholemeal loaf we buy twice a week has increased by 16.7% and the white sliced loaf we buy twice a week by 11% in the last 12 months. This is the same at Tesco/Sainsburys/ASDA etc. Just about everything else in the regular food shop has risen significantly (5-15%) over the last 12 months so I'm at a loss to understand how decreasing food prices have contributed, other than a glitch brought about by temporary buy one get one free or 3 for the price of two offers. When this happens with fresh produce it actually costs more in some cases when low volume users like ourselves end up throwing away the "bargain" buy because it's gone off before we can use it.

Stompa

artha wrote: »

As a retiree who keeps a regular check on food prices I'm amazed by the statements on food price decreases.

I'm not. As far as my regular grocery shopping is concerned, a few items seem to have risen in price by quite a lot, but many more have fallen by a smaller amount. So, on balance, I'm paying less overall.

Losing_the_way

With the added costs to mortgages of the banking changes proposed by the Independent Commission on Banking interest rates will have to stay down for the foreseeable future. To raise them with that on the horizon would have a disastrous effect on the housing market and hence the banking sector.

abaxas

artha wrote: »

As a retiree who keeps a regular check on food prices I'm amazed by the statements on food price decreases. As a limited example, the small wholemeal loaf we buy twice a week has increased by 16.7% and the white sliced loaf we buy twice a week by 11% in the last 12 months. This is the same at Tesco/Sainsburys/ASDA etc. Just about everything else in the regular food shop has risen significantly (5-15%) over the last 12 months so I'm at a loss to understand how decreasing food prices have contributed, other than a glitch brought about by temporary buy one get one free or 3 for the price of two offers. When this happens with fresh produce it actually costs more in some cases when low volume users like ourselves end up throwing away the "bargain" buy because it's gone off before we can use it.

CPI has little or nothing to do with increases in prices. It is the increase in a basket of goods, which changes all the time.

The issue is that since the basket changes you are comparing eggs to wiis, bread to leather sofas etc etc.

CPI is inflation of CPI inflation but is it inflation? Sadly yes, inflation in CPI.

Cleaver

artha wrote: »

As a retiree who keeps a regular check on food prices I'm amazed by the statements on food price decreases. As a limited example, the small wholemeal loaf we buy twice a week has increased by 16.7% and the white sliced loaf we buy twice a week by 11% in the last 12 months. This is the same at Tesco/Sainsburys/ASDA etc. Just about everything else in the regular food shop has risen significantly (5-15%) over the last 12 months

What's quite interesting though, from a social point of view, is that people still seem happy to buy their bread ready made so it seems that the tipping point of expensive food hasn't been reached yet.

What I'm saying is that to buy a nice loaf of bread you'll have to spend around £1.20. To buy 7 sachets of yeast and 1 kg of flour would cost you about £1.50 and you could make two or three loaves for the same money.

I've said this before on this forum, but when you see people making their own bread, pizza, chips, sauces, pasta etc. you know that food prices have reached a high tipping point. I think we're a long way off that though.

artha

Stompa wrote: »

I'm not. As far as my regular grocery shopping is concerned, a few items seem to have risen in price by quite a lot, but many more have fallen by a smaller amount. So, on balance, I'm paying less overall.

I must be buying the wrong things or live in an expensive area then. I'm pretty sure that just about every food staple I buy on a regular basis is more expensive than a year ago. For prepacked fruit and veg you have to be carefull as a number of pack sizes have started to reduce eg 1kg bags have now become 750g or 7 apples has become 6 in a bag etc. Interestingly the BBC News24 site had a figure of 5.7% for food inflation this morning. Given the dramatic increases in raw cereal/rice/sugar etc commodity prices over the last year it's hard to see why some foods have apparently come down other than by a quirk of circumstance and calculation

Thrugelmir

artha wrote: »

For prepacked fruit and veg you have to be carefull as a number of pack sizes have started to reduce eg 1kg bags have now become 750g or 7 apples has become 6 in a bag etc.

Precisely how the £ shops have maintained prices. Smaller pack sizes.

DervProf

artha wrote: »

Given the dramatic increases in raw cereal/rice/sugar etc commodity prices over the last year it's hard to see why some foods have apparently come down other than by a quirk of circumstance and calculation

Some foods, such as Tesco's Finest Individually Hand Picked, Deseeded and Polished White Grapes may have reduced in price, due to the fact that they had huge price increases until they weren't selling any. As far as I can tell, the stuff I buy every week - luxuries such as eggs, bread, minced beef, oranges, peppers etc have not come down in price. I think milk has a little though :cool:.