TAVIA GRANT – The Globe and Mail
For inflation’s scorekeepers, it’s out with film developing and in with tablet computers and smartphones.
Statistics Canada is revamping its approach to measuring the price of goods to reflect new realities about today’s consumer experience: Spending habits are changing more rapidly, and the lifespan of products is growing ever shorter.
This month, for the first time in four years, the federal agency is updating the basket of goods and services that measures price changes, adding new items like tablet computers, smart phones and dried lentils, and de-emphasizing older ones, such as photography services.
And starting next year, the agency plans to revise the basket every three years or less because consumption patterns are changing more quickly. Statscan has typically updated the basket every four or five years. Similar agencies in other countries, such as Britain or Sweden, update their measures every year or two.
The consumer price index is one of the most important measures of changes in the economy. Not only does it track price changes over time, and across regions, it also influences old-age pensions, rental agreements, child support payments and wages. It is also a key determinant in setting monetary policy.