"Core inflation is a measure of inflation in the consumer price index after excluding the volatile components of the consumer price index, such as energy and food. Typically, volatile energy and food prices have an impact on the overall inflation rate is relatively significant, so excluding it can more accurately reflect the basic trend of inflation.
Core inflation is calculated from the Consumer Price Index (CPI), which reflects changes in the prices of a basket of consumer goods and services. The prices of consumer goods and services are often affected by a variety of factors, including production costs, monetary policy, tax policy, demographic changes, and more. Therefore, the core inflation rate can better reflect the underlying inflation level of the economy and is not affected by short-term price fluctuations.
The core inflation rate is a very important macroeconomic indicator, which can provide an important reference for central bank and government policy makers. The central bank usually regards the core inflation rate as one of the important reference indicators for formulating monetary policy, because a stable core inflation rate can provide the economy with a stable growth environment and an economic environment with low inflation. Governments and businesses can also use the core inflation rate to formulate pricing strategies and manage costs.
Changes in core inflation have broad economic implications. When core inflation rises, the central bank may tighten monetary policy to control inflation and may lead to slower economic growth. Conversely, when core inflation falls, the central bank may adopt easy monetary policy to stimulate economic growth.
In short, the core inflation rate is a very important macroeconomic indicator, which can reflect the inflation level of the consumer price index after excluding components with large price fluctuations such as energy and food. The government, central bank and enterprises should pay close attention to changes in the core inflation rate and take appropriate measures to deal with the possible impact. "