Some reading material on measuring Core Inflation from both AUS and overseas.
The references contain definitions and graphs.
Maybe it's time for a new approach ?
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AUSTRALIA
Measuring Core Inflation in Australia with....
http://www.rba.gov.au/PublicationsAndRe ... /vahey.pdf

Box B: Real Interest Rates
http://www.rba.gov.au/Education/Underst ... 0201_1.pdf

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PHILIPPINES & other countries
Core Inflation and Various Approaches of Core Inflation Estimation
http://www.nscb.gov.ph/stats/cpi/primer/default.asp
This has an easy to follow format with the following Q+A

1. What is core inflation?
2. How is core inflation different from CPI or “headline” inflation?
3. Why do we need to measure core inflation?
4. How is core inflation measured or computed?

Cross-Country Experiences on Core Inflation
5. Do other countries monitor core inflation?
6. How do other countries measure core inflation?
7. How do policymakers use core inflation in other countries?

Towards an Official Definition of Core Inflation in the Philippines
8. Is there an official definition of Core Inflation in the Philippines?
9. How was the official definition of core inflation determined?
10. Why was the exclusion method chosen for the official definition?
11. What specific items were excluded in order to estimate core inflation?
12. Is it possible to cite an example of the numerical computation of core
inflation based on the official definition?
13. Which government agency will generate the official core inflation data?
14. Will core inflation replace the current CPI or headline inflation
published by the NSO?
16. Is there any program that will help explain and popularize the concept
of core inflation?

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Core Inflation
Economist's View
http://economistsview.typepad.com/econo ... flati.html

Is Core Inflation a Systematically Biased Measure of Actual Inflation?

"Does core inflation systematically underestimate actual inflation as many believe?
Here are graphs of the CPI along with the CPI less food and energy, and the PPI for finished
goods along with the PPI less food and energy through September of this year
(the starting dates are different in the two graphs due to data availability).
Core inflation is less than actual inflation recently due to rapidly increasing
energy costs, but overall it's difficult to detect a systematic bias in either direction:"

(Graphs are up to up to Sept 2005)