Paris, March 26 - Food price volatility is posing a challenge for conducting monetary policy partly because it distorts the interpretation of price indicators, Bank of France Governor Christian Noyer said on Thursday.
"In terms of macroeconomic regulation, the food price volatility that we are witnessing constitutes a particular challenge for the conduct of monetary policy for at least three reasons," Noyer told a forum on food security.
One of the reasons was that it distorted the interpretation of price indicators by creating a large divergence between headline and core inflation, said Noyer, who is also a governing council member of the European Central Bank.