Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/153339
Authors: 
Bilke, Laurent
Stracca, Livio
Year of Publication: 
2008
Series/Report no.: 
ECB Working Paper 905
Abstract: 
We propose a new core inflation measure for the Euro area which places the emphasis on the more lasting, i.e. persistent, price developments at a disaggregated level. The importance of each component of the HICP is reweighted according to its relative persistence, as measured by the sum of the autoregressive coefficients or by an indicator of mean reversion. Unlike headline inflation, our baseline core inflation measure is highly correlated with ECB monetary policy decisions, which could mean that it contains ex ante (pre monetary policy) information on inflationary pressure.
Subjects: 
core inflation
inflation persistence
JEL: 
E31
Document Type: 
Working Paper

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