Models used to describe and predict inflation commonly distinguish between changes in food and energy prices - which enter into total inflation - and movements in the prices of other goods and services - that is, core inflation.

Transparency concerning the Federal Reserve's conduct of monetary policy is desirable because better public understanding enhances the effectiveness of policy. More important, however, is that transparent communications reflect the Federal Reserve's commitment to accountability within our democratic system of government.

Food and energy account for a significant portion of household budgets, so the Federal Reserve's inflation objective is defined in terms of the overall change in consumer prices.

Janet Yellen Quotes