Consider the following statements 1 Headline inflation excludes those commodities from its basket wh...........

Economic Affairs Inflation

Consider the following statements:

1. Headline inflation excludes those commodities from its basket which are volatile in short-term.

2. Core inflation is a correct measure of inflation in long term.

3. Consumer Price Index (CPI) is the measure of headline inflation in India.

Which of the following statements given above is/are correct?

2 only

1 and 2 only

2 and 3 only

1, 2 and 3

Only statement 2nd is correct.

Headline inflation is a measure of the total inflation within an economy, including commodities such as food and energy prices (e.g., oil and gas), which tend to be much more volatile and prone to inflationary spikes.
Core inflation represents the long run trend in the price level. In measuring long run inflation, transitory price changes should be excluded. One way of accomplishing this is by excluding items frequently subject to volatile prices, like food and energy.
Headline Inflation is the measure of total inflation within an economy. It includes price rise in food, fuel and all other commodities. The inflation rate expressed in Wholesale Price Index (WPI) usually denotes the headline inflation. Though Consumer Price Index (CPI) values are often higher, WPI values traditionally make headlines.

Hence option 1st is correct.