First few Article Sentences
Most people and organizations are feeling the pressure of inflation through higher priced goods and services, and at the same time being paid very low interest on short -term investments. When an investment’s future value is lower than its current value adjusted for inflation, it is said to have a “negative real dollar return.” The health care industry may be more susceptible than others to this, as it is an essential ubiquitous service. The US Government measures inflation by observing two indices, the Consumer Price Index (CPI), currently at 5.4%, and the Core CPI, currently about 2.5%. Because food and energy are thought to create inflation volatility, these components are removed from the Core CPI number. The predominant measure used by the government is Core CPI, but that measure is argued by many to underestimate inflation (see chart below). The Core CPI target inflation zone ranges between 1.5% and 2%. Furthermore, some items may take time to “trickle down” in order to realize inflationary pressure; some of these items include bulk purchases, advanced purchases, and hedged inputs.