EconPapers    
Economics at your fingertips  
 

Evaluating Alternative Core Inflation Measures for Argentina

Edited by Laura D´Amato (), Lidia Sanz and Juan Sotes-Paladino

in BCRA Paper Series from Central Bank of Argentina, Economic Research Department, currently edited by Germán Feldman

Abstract: Monetary policymaking requires an adequate appraisal of price dynamics and reliable forecasts for short and medium term inflation. Since the relevant inflation for monetary policy purpose may not be adequately measured by conventional consumer price indexes, there is a need for core inflation measures that adequately reflect coordinated and persistent movements in the price level. With this aim, eight different measures of core inflation are constructed, based on i) re-weighting of CPI components in a new aggregate index according to the relative significance of each item as a signal of inflation, ii) excluding the most volatile CPI components, or directly those related to food and energy, considered to be less affected by monetary policy; iii) calculating a robust estimator of the first order moment for the cross sectional distribution of CPI inflation that excludes extreme values. These indicators are evaluated on the basis of their ability to predict consumer price inflation. The results indicate that the core inflation measure constructed according to criterion i) of signal extraction provides the core inflation measure with the best relative performance.

Keywords: Argentina; consumer price index; core inflation measures; inflation (search for similar items in EconPapers)
JEL-codes: E31 E37 (search for similar items in EconPapers)
Date: 2006
ISBN: 987-20003-2-8
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.bcra.gov.ar/pdfs/investigaciones/evaluacion_medidas_i.zip English Version (application/pdf)
http://www.bcra.gov.ar/pdfs/investigaciones/evaluacion_medidas.zip versión en Español (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bcr:estudi:01

Access Statistics for this book

More books in BCRA Paper Series from Central Bank of Argentina, Economic Research Department Contact information at EDIRC.
Bibliographic data for series maintained by Federico Grillo ().

 
Page updated 2022-06-11
Handle: RePEc:bcr:estudi:01