rigidities impede policymakers' ability to control inflation. And third, we describe how alternative shock/rigidity combinations … monetary policymaking. First, we discuss why trimmed means provide the best measure of core inflation. Second, we outline how … create inflation's grease (whereby it improves economic efficiency by speeding adjustment) and sand effects (whereby it …

.e. whose price changes rarely) contain more information about medium term inflation developments than those of flexible price … inflation index indeed has a forward-looking component, as it has favorable inflation forecasting properties on the policy … horizon of 1-2 years to alternative inflation indicators (including core inflation). Both theoretical and empirical results …