Although the overall inflation rate from the April Consumer Price Index was unchanged at 0.5% what we have termed the ‘core’ rate of inflation edged up. The measure excludes mortgage interest (down 6.8% in the year) and energy products (almost unchanged in the year with a drop of 0.1%). This represent about 15% of the overall index. The overall and ‘core’ inflation rates for the past few years have been like this.
Although it increased in April, at 0.9% the core rate of inflation is still below the levels it was at for most of the past year. Finally here is an interesting chart from Danske Bank which compares the Irish Harmonised Index of Consumer Prices (HICP) inflation rate, which also excludes mortgage interest, with the euro area average.
Posts
Just one typo Seamus:
ReplyDelete" The measure includes mortgage interest (down 6.8% in the year) and energy products (almost unchanged in the year with a drop of 0.1%)."
- I think should read "excludes"
Greg
On second review Seamus, I'm a bit unclear as to your definition of core inflation.
ReplyDeleteAs I understand it, the standard measure of CPI core inflation includes mortgage interest and excludes unprocessed foods and energy. There is no CPI measure - that I can see - which excludes both mortgage interest and energy (Core HICP??) in the release. Did you construct your own index?
Greg