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PNC Christmas Price Index Predicts Holiday Cheer, Not Prices, On The Rise This Year | Forbes

It’s beginning to look (and feel) a lot like Christmas! If you’re in the gift-giving mood, consider that purchasing all the gifts in the classic carol “The 12 Days of Christmas” will cost you $34,558.65 in 2017, a boost of just about $200 from last year. That’s the official tally according to the 34th PNC Christmas Price Index.

PNC’s Christmas Price Index®, or PNC CPI, is calculated using a method similar to the government’s consumer price index (CPI) and measures the cost of buying the gifts given in the song, “The 12 Days of Christmas.” By way of comparison, the government’s CPI measures the cost of goods and services for consumers. Each month, the U.S. Bureau of Labor Statistics reports on the CPI; since those numbers are tied to inflation, they tend to be indicators on interest rates. That’s important to taxpayers since the Tax Code provides for mandatory annual adjustments to certain tax items based on interest rates. When the Internal Revenue Service (IRS) announced the annual adjustments for 2018 (here), the numbers meant savings for most taxpayers. Why? A higher CPI pushes the brackets upward and increases the standard deduction and exemption amounts, which means that the taxes due on the same income will decrease.

To keep the comparison between government and its own index fair, PNC removes the cost of the swans, typically the most volatile item in the list (the government similarly excludes energy and food prices). By taking the swans out, PNC’s core CPI rose just .9% (the government’s core CPI increased by 1.7%).

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PNC Christmas Price Index Predicts Holiday Cheer, Not Prices, On The Rise This Year.

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