PNC Christmas Price Index on track with economic indicators
A sluggish economy coupled with weak demand has kept the 2011 PNC Christmas Price Index to a moderate gain of 3.5 percent in the whimsical economic analysis by PNC Wealth Management based on the gifts in the holiday classic song, “The Twelve Days of Christmas.”
According to the 28th annual survey, the price tag for the PNC CPI is $24,263.18 in 2011, $823.80 more than last year and less than half the increase seen in 2010. Still, that comes on the heels of a more modest 1.8 percent increase two years ago at the end of the recession.
The results are posted on an enhanced website, www.pncchristmaspriceindex.com, which includes an interactive train journey through a winter wonderland setting. The site also reflects PNC’s commitment to education by teaching economic trends through the PNC CPI.
As part of its annual tradition, PNC Wealth Management also tabulates the True Cost of Christmas, which is the total cost of items gifted by a true love who repeats all of the song’s verses. This holiday season is the most expensive year ever: very generous true loves have to fork over $101,119.84 for all 364 gifts, a 4.4 percent increase compared to last year.
“As the economy continues to struggle, we are seeing weakness in some areas of demand within the Index,” said Jason Priddy, PNC Wealth Management senior trust advisor. “That is illustrated in the costs of the five gold rings. While gold commodity prices are at or near record highs, the demand for retail gold is waning, and thus our five gold rings actually dropped by 0.8 percent this year.”
Although the economic trends affect both indexes, this year the PNC CPI’s increase is exceptionally close to the government’s Consumer Price Index, which grew 3.9 percent over the last 12 months.
For true loves who prefer the convenience of shopping online, PNC Wealth Management calculates the cost of “The Twelve Days of Christmas” gifts purchased on the internet.
This year, the trends identified in the traditional index are repeated in the internet version. True loves will pay a grand total of $39,860 to buy the items online. That is 16.1 percent more expensive than last year and almost $16,000 more than this year’s traditional index.
“In general, internet prices are higher than their non-internet counterparts because of premium shipping costs for birds and the convenience factor of shopping online,” Priddy said.
Each year, educators across the country use the Christmas Price Index to teach economic trends to middle and high school students. With that in mind, this year’s site includes interactive activities, annual results and PNC CPI trends in a Flash presentation, MP3 downloads and much more.
Educators who visit the site will also find lesson plans on the Christmas Price Index from The Stock Market Game, a program of the Securities Industry and Financial Markets Association Foundation for Investor Education (www.sifma.org/education). The activities are specially designed to help students identify economic trends and project their impact on this year’s index, giving them the opportunity to make predictions and check their success against actual results. SMG is America’s premier educational stock market simulation. Available in all 50 states for grades 4-12, the SMG program teaches children core academic and investment skills.
The PNC Financial Services Group Inc. is one of the nation’s largest diversified financial services organizations providing retail and business banking; residential mortgage banking; specialized services for corporations and government entities, including corporate banking, real estate finance and asset-based lending; wealth management and asset management. Visit www.pnc.com. Follow @PNCNews on Twitter for breaking news, updates and announcements from PNC.
