Chicken Backs Impact Inflation, GPS and Pocket Calculators Dropped from List
The Hungarian Central Statistical Office (KSH) has updated the list of items monitored for calculating inflation, including the addition of new products that reflect changing Hungarian consumption habits and the removal of items that have become obsolete.
As of now, the fluctuation in the price of chicken backs will be factored into inflation, a response to the fact that products are appearing on store shelves in ever-smaller packaging sizes. In contrast, items such as medium-sized dictionaries, alarm clocks, and pocket calculators, once critical goods, no longer contribute to the inflation figure.
What's This All About?
Every month, KSH examines the prices of nearly a thousand different products and services in Budapest and the 19 counties, compiling final inflation data from approximately 80,000 different price changes. The detailed list guides price collectors with descriptions like "1 bottle of olive oil, extra virgin, 500 ml" or "Corner sofa suite, with pull-out bed, 260-300 cm x 140-180 cm." Annually at the beginning of the year, the list is adjusted to match changes in consumer habits. The complete list can be downloaded from the description of the inflation methodology table.
Among the most significant changes in the newly updated list is the inclusion of air fryers and smartwatches, signaling these items' rapid ascent in popularity. Traditional products like medium dictionaries and alarm clocks have been removed, highlighting the impact of smartphones on the market even for previously essential items like GPS navigation systems.
A Shift in the Basket
Some noticeable adjustments reflect the "shrinkflation" phenomenon, where products appear in smaller packages:
- Bacon had to be between 200 and 500 grams to count in inflation calculations, but now items as small as 100 grams are included.
- The minimum weight for extruded millet balls is now 60 grams instead of 75.
- Spaghetti and instant cocoa powder can also be considered in smaller package sizes than before.
- Smaller weights for packaged hazelnuts and pepper are accounted for as well.
Significant changes also include more substantial weighting for food products, from 28.96% to 30.1%, reflecting increased expenditure on them. Conversely, the weighting for fuel has decreased from representing 8.1% of inflation to just 6%, indicating reduced consumption in 2023. Utility costs have also seen a slight decline in their importance.
In clothing items, used clothes prices now influence the inflation calculation, signaling a trend towards thriftiness amidst economic strain. However, bathrobes have been removed from the list, suggesting a decline in their purchase.
Innovations and Goodbyes
The introduction of induction cooktops and robots for vacuum cleaning to the list indicates how technological advancement influences spending habits. At the same time, the goodbye to pocket calculators and alarm clocks marks the end of an era for these once-essential products.
The car category sees constant revision, with the inclusion of new models like the BMW X1 and Mercedes GLC 300 over older, less sold ones like the BMW 118d and Skoda Fabia Ambition.
Missing from the List
Notably absent from KSH's inflationary basket is the cost of housing or related loans, a topic of intense debate among statisticians. While the American approach includes these in their inflationary measures, European Union statisticians, following Eurostat's lead, do not count home purchases as consumer expenses. Rent, however, continues to be a part of the basket.
The comprehensive adjustments to the inflationary basket offer a nuanced look into the evolving market trends, consumer habits, and priorities within the Hungarian economy.
What's This All About?
Every month, KSH examines the prices of nearly a thousand different products and services in Budapest and the 19 counties, compiling final inflation data from approximately 80,000 different price changes. The detailed list guides price collectors with descriptions like "1 bottle of olive oil, extra virgin, 500 ml" or "Corner sofa suite, with pull-out bed, 260-300 cm x 140-180 cm." Annually at the beginning of the year, the list is adjusted to match changes in consumer habits. The complete list can be downloaded from the description of the inflation methodology table.
Among the most significant changes in the newly updated list is the inclusion of air fryers and smartwatches, signaling these items' rapid ascent in popularity. Traditional products like medium dictionaries and alarm clocks have been removed, highlighting the impact of smartphones on the market even for previously essential items like GPS navigation systems.
A Shift in the Basket
Some noticeable adjustments reflect the "shrinkflation" phenomenon, where products appear in smaller packages:
- Bacon had to be between 200 and 500 grams to count in inflation calculations, but now items as small as 100 grams are included.
- The minimum weight for extruded millet balls is now 60 grams instead of 75.
- Spaghetti and instant cocoa powder can also be considered in smaller package sizes than before.
- Smaller weights for packaged hazelnuts and pepper are accounted for as well.
Significant changes also include more substantial weighting for food products, from 28.96% to 30.1%, reflecting increased expenditure on them. Conversely, the weighting for fuel has decreased from representing 8.1% of inflation to just 6%, indicating reduced consumption in 2023. Utility costs have also seen a slight decline in their importance.
In clothing items, used clothes prices now influence the inflation calculation, signaling a trend towards thriftiness amidst economic strain. However, bathrobes have been removed from the list, suggesting a decline in their purchase.
Innovations and Goodbyes
The introduction of induction cooktops and robots for vacuum cleaning to the list indicates how technological advancement influences spending habits. At the same time, the goodbye to pocket calculators and alarm clocks marks the end of an era for these once-essential products.
The car category sees constant revision, with the inclusion of new models like the BMW X1 and Mercedes GLC 300 over older, less sold ones like the BMW 118d and Skoda Fabia Ambition.
Missing from the List
Notably absent from KSH's inflationary basket is the cost of housing or related loans, a topic of intense debate among statisticians. While the American approach includes these in their inflationary measures, European Union statisticians, following Eurostat's lead, do not count home purchases as consumer expenses. Rent, however, continues to be a part of the basket.
The comprehensive adjustments to the inflationary basket offer a nuanced look into the evolving market trends, consumer habits, and priorities within the Hungarian economy.
