How is HICP calculated?
The HICP for each euro area country is calculated as a weighted average of price changes for a wide range of product groups, using the respective share of each group in the total expenditure of all households for the goods and services covered by the index.
What is inflation forecasting?
Definition of. Inflation forecast. Inflation forecast is measured in terms of the consumer price index (CPI) or harmonised index of consumer prices (HICP) for euro area countries, the euro area aggregate and the United Kingdom. Inflation measures the general evolution of prices.
Is CPI the same as HICP?
The HICP also differs from the US CPI by excluding owner-occupied housing from its scope. The US CPI calculates “rental-equivalent” costs for owner-occupied housing while the HICP considers such expenditure as investment and excludes it.
What is the inflation forecast for 2021?
Projections made between February and August 2021 predicted some rise in 2021 inflation, but anticipated retreating to much lower levels in 2022, with personal consumption expenditures inflation close to the Federal Reserve’s 2 percent target. Data from the past few months has shaken that optimism, however.
What is the difference between PCE and CPI?
The CPI measures the change in the out-of-pocket expenditures of all urban households and the PCE index measures the change in goods and services consumed by all households, and nonprofit institutions serving households.
Does the EU use CPI?
In the long-term, the European Union Consumer Price Index (cpi) is projected to trend around 122.78 points in 2023 and 126.21 points in 2024, according to our econometric models.
Why do we forecast inflation?
Households and businesses need estimates of future prices to make well-informed decisions. Policymakers, whose job is to aid in those decisions by promoting stable prices, need accurate forecasts in order to monitor inflation and make course corrections when necessary.
How does inflation arise?
Inflation is a measure of the rate of rising prices of goods and services in an economy. Inflation can occur when prices rise due to increases in production costs, such as raw materials and wages. A surge in demand for products and services can cause inflation as consumers are willing to pay more for the product.
What is HICP inflation rate?
The Harmonised Indices of Consumer Prices (HICP) measure the changes over time in the prices of consumer goods and services acquired by households. They give a comparable measure of inflation as they are calculated according to harmonised definitions.
What is the rate of inflation from 2021 to 2022?
As of July 2021, the inflation rate for the United States was forecast to reach 3.41 percent in 2021, and 2.67 percent in 2022.
Is inflation expected to rise 2022?
(March 18, 2022) The Federal Open Market Committee (FOMC), in its latest meeting on March 16, 2022, forecasted that the Personal Consumption Expenditures (PCE) inflation rate in the United States will average at 4.3% in 2022, and then decline to 2.7% in 2023.
Is PCE higher than CPI?
The PCE includes more comprehensive coverage of goods and services. PCE data can be revised more extensively than the CPI, which can only be adjusted for seasonal factors and only for the previous five years.
What is HICP (harmonised indices of consumer prices)?
The Harmonised Indices of Consumer Prices (HICP) measure the changes over time in the prices of consumer goods and services acquired by households. They give a comparable measure of inflation as they are calculated according to harmonised definitions .
What is the HICP?
The HICP provides the official measure of consumer price inflation in the euro area and the EU. The manual intends to be a practical guide to all steps necessary to produce an HICP and is thus useful for statisticians who are new to the field of price statistics and statistical offices aiming to set up a similar inflation measure.
What is contemporaneous aggregation of HICP forecasts?
Contemporaneous aggregation of forecasts may be considered in two dimensions: the aggregation of national HICP forecasts for euro area countries and the aggregation of HICP subcomponent forecasts for the euro area.
Can aggregate HICP inflation forecasts be improved by aggregating subindices?
This study analyses whether the accuracy of forecasts of aggregate euro area inflation can be improved by aggregating forecasts of subindices of the Harmonized Index of Consumer Prices (HICP) as opposed to forecasting the aggregate HICP directly.
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