To Trim or Not to Trim? An Application of a Trimmed Mean Inflation Estimator to the United Kingdom

Bank of England Working Paper No. 97

37 Pages Posted: 24 Sep 1999

See all articles by Hasan Bakhshi

Hasan Bakhshi

Bank of England - Monetary Analysis

Anthony Yates

Bank of England - Monetary Analysis

Date Written: 1999

Abstract

Although the target of monetary policy is clear, there have been suggestions that the conduct of monetary policy is improved by monitoring "trimmed mean" inflation rates, the mean of some central portion of the distribution of price changes. This paper assesses critically the theoretical and empirical arguments for trimming, and applies the concept of the "optimal trim" to the United Kingdom.

JEL Classification: E52, E58

Suggested Citation

Bakhshi, Hasan and Yates, Anthony, To Trim or Not to Trim? An Application of a Trimmed Mean Inflation Estimator to the United Kingdom (1999). Bank of England Working Paper No. 97, Available at SSRN: https://ssrn.com/abstract=176688 or http://dx.doi.org/10.2139/ssrn.176688

Hasan Bakhshi (Contact Author)

Bank of England - Monetary Analysis ( email )

Threadneedle Street
London EC2R 8AH
United Kingdom
020 7601 5996 (Phone)

Anthony Yates

Bank of England - Monetary Analysis ( email )

Threadneedle Street
London EC2R 8AH
United Kingdom

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