The government tries to guess which prices ratchet only up (e.g. new cars) and which prices rise and fall (e.g. gasoline). They then report the inflation rate on the ratcheting goods only, because that should be more predictive of what's going to happen in the future.
The government tries to guess which prices ratchet only up (e.g. new cars) and which prices rise and fall (e.g. gasoline). They then report the inflation rate on the ratcheting goods only, because that should be more predictive of what's going to happen in the future.