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The Retail Price Index is an important national statistic for the United Kingdom. It represents a measure of price changes for a variety of goods and services, as part of an ongoing national analysis of inflation and other financial eventualities. The Retail Price Index has been part of the U.K.’s annual statistical reporting since 1947.
Data for the Retail Price Index comes from a national survey called the Expenditure and Food Survey that is undertaken in Britain and other parts of the United Kingdom every year. Experts explain that the actual measurement comes from looking at prices that households pay for selected goods and services. It’s important to note that, according to United Kingdom government sources, some higher or lower income households are excluded from the analysis of what consumers pay for goods and services. The Retail Price Index tracks about 650 items and the prices that are paid for them.
Those who evaluate these kinds of price indices in the U.K. might use these national statistics for business purposes, to project supply and demand, or to try to predict rates of inflation. U.K. government agencies report that the national government has also used this index in order to set rates for pensions and state benefits. For those outside of the country, the U.K. Retail Price Index can provide clues on what is likely to happen within the national economy in coming years.
Other countries have their own forms of statistics for measuring the prices of retail goods. In the United States, the Consumer Price Index plays much the same role as the Retail Price Index does in the U.K. The U.S. Consumer Price Index is furnished by the U.S. Bureau of Labor Statistics.
Analysts look at these kinds of index measures to track general economic growth and other aspects of complicated financial systems. When a statistic like the U.S. consumer price index or the similar index in the U.K. goes public, it is likely to be reported on by financial journalists as a key piece of information about current economics. Pundits and others might use these resources to build their own informed opinions about what is likely to happen within industry sectors in a country, or within the national economy in general.