|Wholesale Prices Cause Inflation Concerns|
|Topic||Employment, Unemployment and Inflation|
Of Course, This Number Doesn't Include That Extra Dollar Per Gallon at the Pump
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Reference ID: A143506632
The "core" wholesale price index excludes prices for food and energy prices because the volatility of their prices distorts what is happening to the price level overall over time. Food and oil prices rise and fall rather rapidly-partly because of speculation on commodity markets, and partly because those who need large supplies of such commodities may over-react to negative news. Such wild price swings leave any sort of sensible statistical price indexes at their mercy. The Federal Reserve in particular, and increasingly, other analysts, prefer to use the core index instead of the overall index as an indication of where the economy is headed in the next few months.
|Source||Vikas Bajaj, "A 3rd Rise in Core Wholesale Prices Spurs Concern over Inflation", The New York Times Online,March 22, 2006.|
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