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Hey guys! It’s no secret that FT Alphaville has been thinking a lot about the UK inflation numbers for a while now. So what’s the harm in doing a little more? After all, you’re probably doing nothing today.

Earlier this month we looked at the small, caged mammals of certain items that the Office for National Statistics monitors. Let’s try to define that word:

small caged mammals noun

: the tendency for an item within the Office for National Statistics inflation basket to generate markedly different price observations, indicating that ONS agents are not observing similar items.

At the risk of getting into an unnecessary frog/blog exegesis dissection, this was part of the gist of our original post on small caged mammals: that the odd spread of recorded prices indicated that several small caged mammals were being observed. This calls into question the value of the measurement and highlights problems with the ONS methodology.

As we approach the first anniversary of that article, we are expanding the analysis a bit. The ONS’s detailed inflation tables ostensibly anonymize the stores where their agents were making price observations, assigning each a unique identifier within their region. One price is recorded per store per month, but not every store appears every month.

We used this in our article on Taylor Swift on Wednesday to find out if there were any exorbitant prices at hotels near her performances.

And with the power of technology, we can do it again, only bigger. So we combined all the small caged mammal price measurements since December 2019 into one dataset, divided them by store, and created a price time series for each store’s monthly observed price.

Before we a lot of charts, let’s establish some loose vibes. First, let’s look at the average price of a small caged mammal according to the ONS.

The ONS already publishes price ranges for some individual items, but small caged mammals aren’t among them, so (as far as we can tell) it’s simply a matter of merging a few spreadsheets:

—ah.

Okay, here it is:

If anyone was concerned about the plight of small caged mammals, this graph would probably do little to calm them down. But it isn’t complete wild: it is plausible that a major player like Pets At Home could have boosted the entire index for most of 2023 with a temporary price increase.

Now, about those individual stores. We assigned each of them a unique ID, which combines their region name and store code (e.g. ‘East Anglia-011’), and created a graph.

In a strange, near-perfect world, observed prices at individual stores would roughly match the chart above: roughly stable, perhaps rising a little through 2023.

More realistically, we can expect the following:

— many flat lines: stores that have not changed their prices.
— some lines with irregular step changes and plateaus: for shops that have adjusted their prices, and perhaps temporarily increased them. For smaller independent shops, it’s probably a case of Maureen and Pete checking their energy bills and realising that after ten years, it’s time to increase hamsters from £10 to £12.
— some lines with small wobbles or small, steady rises: Companies with more pricing power and market visibility can be expected to make smaller price adjustments more often.

What we should not expect is:

— wild, seesaw-like monthly changes: which could indicate a strange pricing system, or (more likely) problems in the data collection process

What might make us think is:

— prices that undergo one-time, huge increases: if a price triples and then holds steady are we looking at a mistake or a major price correction? Are Pete and Maureen price-gouging? Are hamsters just built differently?

So, without further ado, here are almost 200 line charts. See you at the bottom:

Welcome back. As you’ve hopefully noticed, there’s a lot of strangeness in these figures.

First of all: nice. In most cases we see flat lines with small adjustments (mostly upwards), as expected.

But hurray boy there are other types too. Here are a few of our favorites:

Let’s… try to put this into words. From left to right, from top:

— East Anglia-017: [Early 2022] “Doreen, have we sold the last mouse?” “Yes, Keith.” “Okay, don’t ever buy one again, this is a premium guinea pig shop now.”
— East Anglia-071: [Late 2020] “Hello, do you know how we look for small caged mammals?” “Yes, why?” “Can you try something smaller?”
— East Midlands-012: [Some time pre-2020] After a long and enjoyable career at Jane Street, Malcolm opened a pet shop in Wellingborough.
— London-035: [2020–2024] Davide had been involved in the ONS research on small caged mammals for some time, but he still didn’t know exactly what he was looking for.
— Northwest-014: [October 2023] “Merseyside Mice is proud to announce: We have mice again.”
— Scotland-016: [2020–2024] Anita pulled a hexagonal 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 need to change things. The market for mammals under £45 — that’s where the money is.”
— Scotland-050: [2021] “That’s not how selling works, Dad.”
— Wales-012: [2022 onwards] “Rhys, is that the guy from the ONS?” “Yes, Mom.” “Okay, raise the price again.”
— West Midlands-089: [Always] “Why do people say Solihull is posh?”

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