[simonh]

Or they are aligning their prices against a psychologically meaningful breakpoint such as the increase from £7.99 to £9.99 given in the article, which happens to be about 25%, rather than a precisely 20% increase which would yield a price of £9.59.

People here are reading way more into that 5% than is remotely warranted and for ludicrously incidental reasons. What's actually happening here is very simple. Apple has been taking a hit for a while. They are re-aligning prices to the nearest logical breakpoint. That's it. All that analyst guff about Brexit downside risks because of a slight percentage discrepancy with exchange rates is just because analysts don't know crap about the real reason - marketing.

[tlrobinson]

Uh 25% increase only leads to round prices at certain points. 25% increase on £1 is £1.25...

Otherwise I agree with you.

[simonh]

They increased the basic price 'unit' from £0.79 to £0.99. Although at higher price points they use a 'unit' of £1.49 that's now changed to £1.99.

Apple uses prices aligned to multiples of these units, with some rounding. So when Apple realigns UK prices to take into account currency fluctuations, they do so based on a combination of how much and how long the exchange rate has changed, and what their target price units and price points are. Also I'm sure they factor in holiday season timing to e.g. avoid negative publicity running up to Christmas.