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Tuesday, March 24, 2009

RPI Hits Zero

The Retail Price Index (RPI) for February hit 0% for the first time in 49 years, according to government statistics today.

All very well, but why then are prices of life's necessities (eg power, fuel, food, council tax etc) still rising?

Then one needs to consult the Consumer Price Index (CPI), which rose to 3.2% from 3% in January. Mervyn King was forced to write to Alistair Darling to explain why the CPI was still above target of 2%.

All of the above statistics are doubtless fascinating for the politicians, media and chattering classes. However, as they are out of date and indeed do not reflect the reality that people face, their value to the "man in the street" is limited to say the least.

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