RPI/CPI User Group

last person joined: 15 days ago 

To foster co-operation and the exchange of information between the ONS, its advisory bodies and other users. Please see 'Aims of the RPI/CPI User Group' in the library for further details.

Subject: Negative prices

1.  Negative prices

Posted 16-02-2017 15:42
Hi All

I would like raise the subject of negative prices. As an economist I have found myself facing negative interest-rates and bond yields in more than a few places but at lunchtime a negative price appeared. At Tesco's then you can buy a tin of Ambrosia custard for £1.04 or two of them for £1 which means that the second one has a marginal price of - 4 pence! 

I understand that the official inflation data ignores offers of  this sort but if we look at this there are genuine issues if the price recorded is £1.04 when logically everyone would take two tins and the average price is 50 pence.

Regards

Shaun Richards