Saturday, August 18, 2012
Not a word from MSM about CPIH
Richards recounts some of the conversation at a consultation he attended with the Royal Statistical Society on the subject of adding house prices to the Consumer Price Index (CPIH). A member of the Monetary Policy Committee, confirmed that CPIH targeting is approaching: "However the conversation took a slightly different turn as the speakers added that a driver right now was that the current Chancellor of the Exchequer had asked for it [CPIH]. As one of the members of the Monetary Policy Committee Martin Weale was there I asked him if the MPC would therefore target such an index (CPI plus house prices or CPIH) and he replied yes." I can only think of one reason for the Chancellor wishing to target CPIH now - future price falls.