Why monetary policy should focus on core inflation Because households care about the prices of all the items they buy, it clearly does not make sense to pretend that people do not eat or drive.
Although much of the weakness in industrial production toward the end of 2006 can be readily traced to the housing and motor vehicle sectors, production in other manufacturing industries also softened from September through November, and this development raised concerns that the deceleration in economic activity was becoming more broadly based.