The Office for National Statistics has explained how it plans to collect data on prices and compile the usual inflation indices during lockdown and beyond. The problems ONS faces are that, during April, its price collectors were not able to visit the normal retail outlets to obtain prices, whilst some goods and services have simply not been available during lockdown.

April’s CPI and RPI will therefore reflect the new workarounds. These include remote collection of prices and so-called imputed pricing where it is not possible to collect prices. For those items that remain available, the imputed price will be based on the prices and movements in price of similar goods and services.  For those that are simply not available, the imputed price will aim not to disturb the overall price index. Around 20% of the basket of goods and services that make up the different inflation measures is currently unavailable.

Whilst, in the very short term, these workarounds should provide more stability to inflation indices, it may well mean that they become more unstable as goods and services become available again.