Sweatpants and hand sanitiser added to UK inflation calculations

Oscar Williams-Grut
·Senior City Correspondent, Yahoo Finance UK
·2-min read
File photo dated 14/3/2020 of a man uses hand sanitiser gel. A number of hand sanitisers have been found containing less alcohol than described via online marketplaces which could leave people unprotected against coronavirus, a Which? investigation has found.
A man uses hand sanitiser gel. Photo: PA

COVID-19 has upended and rearranged all aspects of life — including inflation.

The Office for National Statistics (ONS) on Monday updated its model basket of goods used to calculate inflation, adding COVID-era staples such as men's sweatpants and hand sanitiser.

The ONS said the inclusion of the two new items was "influenced by the effects of the coronavirus (COVID-19) pandemic, with the increased use of portable hand cleansers by people on the move and more people dressing casually when working at home."

At home workout equipment like dumbbells were also added to reflect changes how Brits are living. Women's sweatpants and other casual wear was already included in the inflation basket prior to the update.

The stats body said it had considered adding face masks and face covering to its calculations but decided not to because "usage could decrease rapidly once the population have been vaccinated."

The ONS added 17 new items to its "shopping basket." Other additions include: hybrid and electric cars; smart lightbulbs; smart watches; and couscous.

"A number of new items have been introduced to represent specific markets where consumer spending is significant or growing and existing items in the baskets may not adequately represent price changes for such goods," the ONS said. "For example, hybrid and electric cars have been added reflecting increased purchases of this type of vehicle and anticipating the longer-term phasing out of petrol and diesel cars."

READ MORE: Bitcoin retreats from record high amid report of Indian crypto ban

Ten items were removed from the basket, including gold chains, canteen sandwiches, and Axminster carpets.

Emma-Lou Montgomery, associate director of personal investing at Fidelity international, said the updates "perfectly encapsulates the trials and tribulations of the year just gone."

“The 'stay home' message has translated into home-cooked food replacing eating out - even if part of the meal is pre-prepped for added convenience - your daily barista-made double macchiato on the way to work swapped out for a DIY caffeine hit on the way from your kitchen to your home ‘office’ and a reliance on comfy casuals rather than professional workwear," she said.

The ONS uses its "shopping basket" of goods to monitor price changes in the economy and calculate inflation. Components are updated annually.

The ONS updated the weighting given to various items alongside changes in the composition of the basket. Transport, restaurants, and recreation and culture costs were all downgraded. Housing, clothing, food and alcohol prices were all given greater weighting. The ONS said the changes were also linked to the COVID-19 pandemic.

Watch: What is inflation and why does it matter?