Measuring EU Inflation – The Foundations of the HICP (Online only)

Date: Monday 11 October 2021, 4.00PM
Location: Online
Section Group Meeting


Share this event

John Astin, RSS Fellow, has recently published a book with this title describing in detail the work undertaken in the development of the EU’s Harmonised Index of Consumer Prices (HICP).

The HICP was a necessary requirement of the Maastricht Treaty of 1992. This was because the treaty set tests for allowing entry into the forthcoming euro area. One of these was to ensure that only those member states with an inflation rate close to those with the lowest rates would be allowed to join. This meant that for the sake of comparability each country would have to compile its inflation index following harmonised standards. This was a big ask: each country had its own inflation index and none were calculated in the same way.

John (then head of statistics at DTI) was recruited in 1991 to lead a team of EU statisticians charged with developing a new index, along with the close participation of price statisticians in all 12 member states. The HICP was delivered in 1997. It was further developed and improved in the next few years: by the end of the 1990s it was being described as a “state of the art” inflation index. The HICP was later adopted by the UK as the Consumer Price Index for use by the Bank of England as its macroeconomic inflation measure, used for setting the interest rate and other purposes. Though the UK is no longer required by EU law to calculate the HICP, the CPI is still used by the Bank. John will outline some of the issues and problems he encountered in developing the HICP. The presentation will be chaired by Tony Cox, Chair of the Statistics User Forum’s RPI/CPI User Group and Paul Smith, Professor of Official Statistics at Southampton University will act as discussant.

It will be a hybrid event organised jointly by the RSS History Section and the Official Statistics Section.

The event is free, but you must register to attend

This page is for online attendance at the event - you can register here for the in-person event
 
Organising Group: RSS History Section and Official Statistics Section
Organiser: Peter Smith