ARE COMMODITY PRICES A LEADING INDICATOR OF INFLATION

This article addresses the issue of whether or not commodity prices ca n be used as a leading indicator of inflation. The relationship betwee n consumer prices in industrial countries and four commodity price ind ices is examined using a number of econometric techniques. The main co nclusion is that commodity prices can be used as a leading indicator o f inflation although some of the characteristics of an ''optimal'' lea ding indicator are not met. (C) 1998 Society for Policy Modeling. Publ ished by Elsevier Science Inc.