Core Inflation: Where Are We?

The Week Ahead

October 2, 2017

Steering inflation with monetary policy is akin to driving with a wheel that turns the car with a one-minute delay. That puts a huge premium on having an accurate map that tells the driver what lies down the road. It’s disconcerting, then, to see how radically different inflation trends can appear depending on how you measure them.

In Canada, the central bank has long understood that since total CPI was subject to temporary noise from prices for oil and other volatile items, a “core” concept was needed to assess the true trend.

Read More…