core inflation

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Related to Core Inflation Rates: Imported Inflation

Core inflation

Core inflation for the Consumer Price Index, the Producer Price Index or the Personal Consumption Expenditure Deflator removes the volatile food and energy prices. The Headline inflation includes these components.

Core Inflation

A measure of inflation that attempts to predict future inflation by excluding price volatility. It is thought to be a better measure of underlying inflation as it does not account for temporary price shocks. Some economists who measure core inflation exclude certain markets that tend to be volatile, such as energy and food, while others include all markets but exclude the markets that have had the greatest volatility over the last given period.

core inflation

A measure of consumer price increases after stripping out volatile components such as energy and food. Core inflation is generally considered more accurate than changes in the Consumer Price Index in representing the economy's underlying inflationary pressures.

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

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As rents rise and more businesses are forced to pass on higher costs to consumers, the core inflation rate could rise to 1.5 percent by the end of 2011 from a record low of 0.6 percent last October.

ANALYSIS: Be careful what you wish for: the China Price starts to rise

The difference between their core inflation rates (2.19 percent and 1.75 percent, respectively) is smaller.

Compared to the U.S., the euro areas inflation has been less volatile; the maximum 12-month core inflation rate in the euro area was 2.3 percent in March 2002, and the minimum was 1.3 percent in January 2006.

Monetary policy in the United States, the Euro Area, and Japan

As a matter of fact, core inflation rates - Consumer Price Index excluding food and energy - increased less in 1997 than in any year since 1965.

Vital signs

Moreover, there are clear signals that core inflation rates are falling, implying the prospect that within the foreseeable future we will have attained the lowest rates of inflation in a generation, an encouraging indicator of future gains in standards of living for the American people.

Statements to the Congress

It said that the fall in headline and core inflation rates to the target level, 13 percent on a year-on-year basis, is a comfort factor for the central bank to make another cut in policy interest rates.

CBE expected to cut interest rates Thursday

The MPC attributed this decision to inflationary pressures, including the increase in prices of non-food commodities, which contributed to headline and core inflation rates.

Global challenges may affect Egypt's GDP growth: CBE

The expectation that these core inflation rates would continue to fall to some acceptable levels warranted a pause in the policy of interest rate hikes in 2006.

Monetary policy stays put

He added that CBE might not increase its basic interest rates until the end of this year, especially as the official data indicate a retreat in core inflation rates, which allows the bank to fix the interest rates as well.