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No, CPI includes food, housing and fuel. There is a "core" measure that excludes those, since they add little information but a lot of noise when you want to tr
by effn 14y ago
No, CPI includes food, housing and fuel. There is a "core" measure that excludes those, since they add little information but a lot of noise when you want to track the underlying trend.
- yummyfajitas 14y agoCore CPI includes housing, but not food or fuel (since they are volatile). The difference between core CPI and exponentially smoothed CPI (which removes volatility but includes long term changes in food and fuel) is negligable: http://www.newyorkfed.org/research/staff_reports/sr236.pdf http://www.newyorkfed.org/research/staff_reports/sr236.pdf There may be gaming in CPI, but excluding volatile components is not it. Another way to see it: CPI and Core CPI track each other pretty closely, and until recently Core CPI was actually higher than CPI: http://research.stlouisfed.org/fredgraph.png?g=cMs http://research.stlouisfed.org/fredgraph.png?g=cMs