And in the case of the inflation rate we look beyond the rate of increase of PCE prices and define the concept of the core rate of inflation. While thinking of different aspects of unemployment, we are concerned mainly with trying to find the right measure of the difficulties caused to current and potential participants in the labor force by their unemployment.
In the case of the core rate of inflation, we are mainly looking for a good indicator of future inflation, and for better indicators than we have at present. In making our monetary policy decisions, we are interested more in where the U.S. economy is heading than in knowing whence it has come.