Journal Article
An alternative measure of inflation
Abstract: The author proposes an alternative measure of inflation that captures the intuition behind the use of "core" measures. Inflation is modeled as an unobserved factor affecting the components of an aggregate price index (including food and energy). The common component, estimated using Kalman filtering, resembles usual measures of core inflation; its extrapolation can be used to improve performance in forecasting core inflation.
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Authors
Bibliographic Information
Provider: Federal Reserve Bank of Chicago
Part of Series: Economic Perspectives
Publication Date: 2006
Volume: 30
Issue: Q I