Inflation numbers

Summary

Inflation reports such as the US CPI show how fast prices are rising. Higher-than-expected inflation makes rate cuts less likely and often pushes riskier assets down; lower-than-expected inflation can do the opposite. The "core" figure leaves out food and energy, which jump around, and is often watched more closely.

Key points

• CPI measures how fast consumer prices rise.
• Hotter inflation usually means rate cuts are less likely.
• Core inflation leaves out food and energy.

Check yourself

What does "core" inflation leave out?

Practice