5  The Bank uses several measures to estimate core inflation but puts greatest weight on a sectoral factor model. This model weights those components of the CPI that most closely reflect the general trend in CPI inflation and down-weights those that do not. The weightings evolve over time as the volatility of each component changes.
BIS central bankers’ speeches  3  prices, and the speed with which the recent depreciation feeds through to higher inflation. Our modelling suggests that a 1 percent exchange rate depreciation boosts annual CPI inflation, albeit with a considerable lag, by around 0.1 percentage points.