Evaluating core inflation indicators

Evaluating core inflation indicators

This paper proposes testable conditions for core inflation measures and uses these conditions to evaluate three widely used core inflation indicators for the United States: the ‘excluding food and energy’ indicator; the trimmed mean; and the weighted median. The major conclusion is that both the tri...

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Bibliographic Details
Published in:Economic modelling Vol. 20; no. 4; pp. 765 - 775
Main Authors: Robalo Marques, Carlos, Duarte Neves, Pedro, Morais Sarmento, Luı́s
Format: Journal Article
Language:English
Published: Amsterdam Elsevier B.V 01-07-2003
Elsevier
Elsevier Science Ltd
Series:Economic Modelling
Subjects:
Core inflation indicators
Economic indicators
Economic models
Economic theory
Economics
Evaluation criteria
Inflation
Mathematical models
Methodology
Model testing
Modelling
Monetary economics
Prices
Studies
United States > US
E31
C43
E52
Core inflation indicators
Evaluation criteria
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Summary:This paper proposes testable conditions for core inflation measures and uses these conditions to evaluate three widely used core inflation indicators for the United States: the ‘excluding food and energy’ indicator; the trimmed mean; and the weighted median. The major conclusion is that both the trimmed mean and the weighted median satisfy the proposed conditions and so can be used as useful core inflation indicators. However, the widely used ‘excluding food and energy’ indicator does not meet these conditions and, therefore, should not be used as a core inflation indicator.
Bibliography:ObjectType-Article-2
SourceType-Scholarly Journals-1
ObjectType-Feature-1
content type line 23
ISSN:0264-9993
1873-6122
DOI:10.1016/S0264-9993(02)00008-1