Consumption patterns and inflation measurement issues during the COVID-19 pandemic

Abstract

The coronavirus (COVID-19) pandemic has triggered large shifts in household consumption as well as issues related to price collection. We construct a monthly-reweighted consumer price index for the euro area which is able to capture part of the changes in household consumption since the beginning of the pandemic. In this way, we quantify the gap between published HICP inflation and the inflation rate of the items actually purchased by final consumers. Furthermore, we discuss the issue of price imputation and its impact on published statistics. JEL Classification: E2, E3, E4