Record-breaking cost of the 12 Days of Christmas from turtle doves to lords-a-leaping

Your True Loves lavishand stunningly bird-ladenholiday gift-giving ritual is more expensive than ever before.

But at least this time around, inflations not as piping hot.

This year, the total cost of the twelve gifts mentioned in the "Twelve Days of Christmas" song reached an all-time high of $46,729.86, as reported by PNC Financial Services 2023 Christmas Price Index. This index measures the average price change for items in the traditional Christmas carol, including a partridge, turtle doves, swans, drummers, and other presents. The price increase of 2.7% from last year is more manageable compared to the 10.5% surge seen in the previous year.

The holiday index is showing slightly lower numbers compared to the Consumer Price Index, which increased by 3.2% in the last 12 months and 7.7% compared to this time last year. It seems that even unofficial inflation gauges are being impacted by the aggressive interest-rate hikes in the US.

Amanda Agati, the chief investment officer at PNC's asset management group, told CNN that the long, variable, and lagged effect of the Federal Reserve's monetary policy tightening is also impacting the Christmas Price Index. She noted that while inflation levels are starting to come under control to some extent, the Christmas Price Index has not yet reached the Fed's long-term target of 2% in line with the broader economy.

The "True Cost of Christmas" has reached a new milestone, with the total cost of buying the 364 items from the famous song surpassing $200,000 for the first time in the 40-year history of the index. This all-encompassing category now totals $210,972.66, which is a 2.5% increase from last year. (For example, the singer receives a total of 12 partridges, one delivered every day, and a total of 22 doves, or two for 11 days in a row, etc.)

Pricier doves and live performances

The Christmas Price Index leans more heavily on discretionary purchases than the broad basket of goods and services that feed into the Consumer Price Index.

The merrier measure emphasizes wider economic and pricing trends, including persistent services inflation, decreasing prices for goods, rising housing expenses, increasing wages, and a competitive labor market.

While the prices for five of the gifts (calling birds, gold rings, swimming swans, milking maids, and dancing ladies) remained the same, the expenses for certain live performances went up, indicating ongoing services inflation and higher wages for skilled workers.

The prices for the 10 lords-a-leaping, 11 pipers piping, and 12 drummers drumming increased by 4%, 6.2%, and 6.2%, respectively. Conversely, the nine ladies dancing held steady, largely due to "contractual differences," explained Agati, who noted that PNC calculates some performers' prices using multi-year contracts, and the lords' contract is up for renewal this year.

While there have been significant victories for union members in labor negotiations this year, those earning the federal minimum wage have not seen any progress since 2009. Consequently, the prices for the milking maids remained unchanged once again.

The partridge in the pear tree increased by 13.9%, driven by the 15% increase in housing costs. The half-dozen geese-a-laying, popular due to pandemic backyard farming, saw an 8.3% rise in costs due to higher feed, fuel, and business expenses, according to PNC.

But the pair of turtle doves saw the biggest jump, at 25%, an increase that reflects their rarity and limited supply.

Trimming spending ahead?

The latest index indicates a more stable market for the often unpredictable "seven swans-a-swimming." While their prices remained constant at $13,125, they continue to hold the second-highest spot for cost in the index. Due to their high price and fluctuation, the swans are replaced in the index to establish a "core" holiday CPI reading. This year, the core Christmas Price Index increased by 3.7%, a significant decrease from the 15.4% gain observed last year.

There could be a lot of volatility in the months following the new year, according to Agati. She expressed uncertainty about whether we will slip into a recession next year, calling it the highly anticipated recession that hasn't happened yet.

PNC maintains the belief that a mild recession is possible, but it is also probable that the United States could go through a period of slow economic growth, she noted. Ultimately, it may hinge on the consumer, according to Agati.