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To trim or not to trim? An application of a trimmmed mean inflation estimator to the United Kingdom

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Listed:
  • Hasan Bakhshi
  • Tony Yates

Abstract

Although the target of monetary policy is clear, there have been suggestions that the conduct of monetary policy is improved by monitoring trimmed mean inflation rates, the mean of some central portion of the distribution of price changes. This paper assesses critically the theoretical and empirical arguments for trimming, and applies the concept of the 'optimal trim' to the United Kingdom.

Suggested Citation

  • Hasan Bakhshi & Tony Yates, 1999. "To trim or not to trim? An application of a trimmmed mean inflation estimator to the United Kingdom," Bank of England working papers 97, Bank of England.
    • Handle: RePEc:boe:boeewp:97
    as

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    File URL: http://www.bankofengland.co.uk/archive/Documents/historicpubs/workingpapers/1999/wp97.pdf
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    References listed on IDEAS

    as
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    7. Simon Hall & Mark Walsh & Anthony Yates, 1997. "How do UK companies set prices?," Bank of England working papers 67, Bank of England.
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    9. Alan S. Blinder, 1994. "On Sticky Prices: Academic Theories Meet the Real World," NBER Chapters, in: Monetary Policy, pages 117-154, National Bureau of Economic Research, Inc.
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