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a small mammal in a cage.

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Hello friends! It’s no secret that FT Alphaville has been thinking a lot about UK inflation statistics for some time. So what’s the harm in doing a little more? After all, you probably aren’t doing any work today.

Earlier this month we looked at a small mammal in a cage with some of the items tracked by the Office for National Statistics. Let’s try to define the word:

small cage sucker noun

: the propensity of an item within the Office for National Statistics inflation basket to generate strikingly different price observations, suggesting that ONS agents are not tracking similar items.

At the risk of engaging in unnecessary frog dissection/blog commentary, this was part of the point of our original caged small mammal post: that the strange range of recorded prices suggested that different caged small mammals were being observed, calling into question the value of the measurement and highlighting problems with the ONS methodology.

As this article’s first birthday approaches, let’s expand the analysis a bit. The ONS’s detailed inflation tables ostensibly anonymise the shops where its agents have carried out price observations, assigning each a unique ID within its region. One price per month is recorded for each trade, but not every trade appears every month.

We used it in our Taylor Swift article on Wednesday to back-analyze whether there was price gouging at hotels near her concerts.

And thanks to the power of technology, we can do it again, but on a larger scale. So we combined every small caged mammal price read into a single data set since December 2019, split it by store, and created a price time series for each store’s monthly observed price.

Before we drop a lots of graphs, let’s create some free vibrations. First, let’s look at the average price of a small mammal in a cage according to the ONS.

The ONS already publishes price ranges for some individual items, but the small mammal in a cage is not among them, so (as far as we can tell) it’s a simple matter of putting together a bunch of tables –

—oh.

OK here it is:

If one was already worried about the plight of small mammals in a cage, this chart would probably do little to assuage them. But it’s not completely wild: a likely big player like Pets At Home could push the entire index higher for most of 2023 with a temporary price increase.

Now about individual stores. We assigned each of them a unique ID, combining the region name and store code (eg ‘East Anglia-011’) and got a map.

In a weird, sort of perfect world, the observed prices at individual stores might be a little like the graph above: basically stable, maybe going up a bit in 2023.

More realistically, we might expect:

— lots of flat lines: stores that have not changed their prices.
— some lines with occasional jump changes and plateaus: for stores that have changed prices and those that may be raising them temporarily. For smaller independent shops, it’s probably Maureen and Pete checking their energy bill and realizing that after ten years it’s time to raise the price of hamsters from £10 to £12.
— some lines with a slight jitter or a small, steady rise: companies with greater pricing power and market insight would be expected to make more frequent small price adjustments.

What we should not hope to see:

— wild, whipsaw monthly changes: which would indicate either a bizarre pricing system or (more likely) problems in the data collection process

What might leave us scratching our heads is:

— prices undergo a one-time massive increase: if the price triples and then stays flat, are we looking at a bug or a major price correction? Are Pete and Maureen’s prices dropping? Are hamsters built differently now?

So, without further ado, here are almost 200 line charts. See you below:

Welcome back. As you may have noticed, there are a lot of oddities in these numbers.

First: nice — in most cases, as expected, we are looking at flat lines with small adjustments (usually upwards).

But hoo boy there are some other types as well. Here are some of our favorites:

Let’s try to tell them. From left to right, top:

— East Anglia-017: [Early 2022] “Doreen, have we sold the last mouse?” “Yes, Keith. “Okay, never buy another one, this is now a premium guinea pig emporium.
— East Anglia-071: [Late 2020] “Hey, you know how we look for small mammals in a cage?” “Yeah why?” “Can you try a little smaller?”
— East Midlands-012: [Some time pre-2020] After a long and enjoyable career in Jane Street, Malcolm opened a pet shop in Wellingborough.
— London-035: [2020–2024] Davide had been on the ONS small mammal in a cage for some time and he still wasn’t sure what he was actually looking for.
— Northwest-014: [October 2023] “Merseyside Mice is proud to announce: We’ve got mice again.”
— Scotland-016: [2020–2024] Anita pulled a six-sided die from her coat pocket and prepared to determine what kind of mammal she would be looking at this month.
— Scotland-029: [Late 2019] “We have to change things. The market for mammals under 45 pounds – that’s where the money is.”
— Scotland-050: [2021] “That’s not how sales work, Dad.
— Wales-012: [2022 onwards] “Rhys, is that the ONS guy?” “Yes mum.” “Okay, raise the price again.
— West Midlands-089: [Always] “Why do people say Solihull is bougie?”

Further reading
— The pound hit a one-year high against the dollar after UK inflation held steady

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