3-17

• Σιώκης, Φώτιος

It is widely accepted that the conventional consumer price index may not be the ideal indicator of underlying inflation due to noise included in the index. To remedy this problem several methods have been proposed. Based on statistical and economic criteria we develop alternative inflation measures called trimmed means. The analysis of Greek CPI data reveals that price changes on a monthly basis are widely dispersed, positively skewed, and, consequently, not normally distributed. Further analysis, based on a number of alternative measures of core inflation, concludes that trimmed means provide valuable information about underlying pressures and predict more accurately future inflation.

• Economics and Business
• Computer and information sciences

• Economics
• Statistics

underlying inflation, moments of distribution of price changes, limited-influence estimators

Περιέχει πίνακες, διαγράμματα και βιβλιογραφία, Special thanks go to Dr. Masourakis, head of the Economics Research Division, Alpha Bank and Dr. M. Bryan, Federal Reserve Bank of Cleveland for providing the related literature. The views expressed in this paper are those of the author and do not necessarily represent those of Alpha Bank.