Question

Locate the Consumer Price Index – August 2020 publication

  Helpful Tip: You can find the answers to the questions below in the first two pages of the publication.

• What happened to the CPI inflation rate in March, April, and May 2020? Why do you think this happened?

• What happened to the core rate of inflation in March, April, and May 2020? Why do you think this happened?

Answer 1

Consumer price index used to measure the change in goods and service by its price is to paid by the consumers.which focus on the each goods and service spending habit and attitude of consumers towards it.For this purpose economy divided into several group like urban ,semi urban workers and semi urban clericals.
The last two groups are based on the employed category and their income derived from the employment.
The consumer price index calculated on the bases of foods,householdings, clothes,transportation etc..
For the calculation of CPI mainly giving weights as per the classification urban semi urban etc.
As per the march ,April ,may CPI can see an negative figures due to the pandemic covid 19 situation.all the foods items and services and other basic requirement full felt as negatively.but the medical service showing a positive change in consuming. And also shelter or householding also have positive figures. The major reason due to this happens mainly the covid -19 that lead to this after effect.

Core rate of inflation is the change in inflation without considering without considering basic amenities like mainly in food items,and basic services cost also.
Due to this pandemic situation the inflation within the control of government measures like monetary policies that help to keep the value of money and control the inflation increasing rate.
Core inflation rate is the best tools for predicting analysing the current and future inflation rate without considering the seasonal change of price.and also it help to act connected with monetary policy of the government.