A survey of inflation measures in use at central banks
AbstractThe headline inflation rate is subject to unpredictable, temporary, sector-specific shocks. Therefore, various measures of core inflation have been proposed to isolate the underlying or permanent inflation component. In this paper, a number of criteria are used to evaluate several statistical measures, and the performance of these measures is analysed for the euro area and the Netherlands. It turns out that none of the measures meets all the criteria. Core inflation measures can however serve very well as an analytical tool. A survey of inflation measures in use at central banks in the OECD area confirms that core inflation measures mostly serve as analytical tool only.
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Bibliographic InfoPaper provided by Netherlands Central Bank, Monetary and Economic Policy Department in its series MEB Series (discontinued) with number 2003-19.
Date of creation: Dec 2003
Date of revision:
core inflation; trimmed mean;
Find related papers by JEL classification:
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-02-15 (All new papers)
- NEP-MAC-2004-02-15 (Macroeconomics)
- NEP-MON-2004-02-15 (Monetary Economics)
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