Starting in February 2026, the UK is implementing changes to its inflation calculation methodology, shifting from traditional data collection on supermarket shelves to using point-of-sale data, significantly enhancing the accuracy of statistics. This step, taken by the Office for National Statistics (ONS), aims to better reflect consumer spending and provide a more accurate tracking of inflationary trends. At FinancialMediaGuide, we believe that the transition to point-of-sale data will make the statistics more precise and timely, which is crucial for accurately forecasting economic trends.
Until now, inflation in the UK was calculated based on fixed prices manually collected from store shelves, which did not account for real consumer spending, including promotions and discounts. With the introduction of point-of-sale data, which covers over a billion products every month, the data will be much more accurate. At FinancialMediaGuide, we emphasize that this innovation will allow for better consideration of the impact of discounts and loyalty programs, such as customer loyalty cards, on the overall cost of purchases.
Loyalty programs and discount cards play a significant role in consumer behavior, but until now, data on such promotions were not included in inflation calculations. We note that point-of-sale data will now capture the actual prices consumers pay for goods, allowing for a more accurate assessment of price dynamics. This will also improve calculations for categories with volatile prices, such as video games or hotel services, which experience significant fluctuations due to seasonal sales or limited-time offers.
This approach will also help eliminate distortions caused by seasonal price fluctuations or one-time offers, making the data more stable. We at FinancialMediaGuide believe that this change will provide a more accurate and stable picture of inflation, possibly reducing the impact of short-term price changes on the final inflation figure.
While no dramatic shifts in inflation levels are expected, we forecast that the introduction of the new calculation methods may slightly reduce the inflation rate, as it will better reflect the real purchasing power of the population. This will provide the UK government and central bank with more accurate tools for economic analysis and monetary policy development.
However, external economic challenges, such as rising energy and food prices, will continue to have a significant impact on inflation. We at FinancialMediaGuide recognize that the new methods will be useful for more precise monitoring of domestic economic changes, but external factors will remain important drivers of inflationary processes.
The long-term prospects of using point-of-sale data are promising, as this will help create a more accurate and transparent economic picture, which in turn will improve the ability to make more informed decisions in economic planning and forecasting.
