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Topic: economics-basics

Grocery aisles in a supermarket
Economy
Wednesday, 7/22, 07:18 PM

What is core inflation, and why central banks strip out food and energy

  • Every inflation release has two numbers: the headline rate everyone quotes, and a quieter one called core inflation that leaves out food and energy.
  • Central banks often care more about the second, because the volatile items it removes can hide the real trend in prices.
  • Knowing the difference explains why a falling headline is not always good news.

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