What Can Cause an Increase In CPI?

The so-called core CPI is the core consumer price index. Economists use core CPI mainly in two senses. One meaning is the rising trend of consumer prices or the more stable components of consumer prices. Another meaning is the extent of the increase in consumer prices caused by demand. The core idea is that the price of goods temporarily increased by supply will not affect the long-term trend of price increases. Its impact should be deducted.

Core CPI

The so-called core CPI refers to the price of products that have been greatly affected by climate and seasonal factors.

Relying on core CPI to determine the price situation

China has not clearly defined the core CPI. The United States regards the consumer price index after excluding fuel and equipment prices as the core CPI. It is generally believed that the core CPI can more accurately reflect the macroeconomic operation.

The Consumer Price Index (CPI) reached the 3% threshold, which was defined as moderate inflation, and it easily broke through to 3.8% in April, and stood at more than 4% in May, reaching 4.4%, and in June The CPI has climbed to 6.4%. With the central bank's announcement on July 7 that the benchmark interest rate for deposits and loans rose by 25 basis points, it rose to 6.5% year-on-year in July. The central bank also said it would maintain a sound monetary policy. Its trend has become the weathervane for further macro-control measures. According to experts' predictions, with the effect of the tailswipe effect, the government may raise interest rates again in the second half of the year in order to achieve the goal of controlling the rise in CPI. Don't be too pessimistic.