Core inflation
Also called: underlying inflation
Inflation measured without volatile items, usually food and fuel, to show the underlying trend in prices.
Food and fuel prices swing with weather and global oil markets. Removing them shows whether price rises are spreading through the economy. Analysts calculate core inflation in slightly different ways, and because food and fuel are large real costs for Indian households, headline inflation still matters.
Example
If headline inflation is 6.0% but inflation excluding food and fuel is 3.2%, most of the rise came from food and fuel.
Learn more in these lessons
- Measuring inflation in IndiaHow is inflation measured, and what does the official number leave out?
Related terms
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