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This paper aims at identifying clustering of prices, if any, in terms of co-movements. Also, it examines the quantity-price interaction in the face of other macro variables like money supply, stock market price, real rate of interest and real effective exchange rate. Finally, the paper churns out the component of core inflation from the total price rise and assesses if core inflation has increased over time and has affected the level of living adversely. Findings tend to indicate that the rise in core inflation has reduced the positive effect of economic growth on poverty. The rise in the core inflation of the manufacturing products over time means that the possibility of substituting the agricultural products by manufacturing food products was rather limited. Hence, the role of industry in producing mass consumption goods at a reasonably low price and contributing to the wellbeing of the masses rather seems to have remained unrealized. [ABSTRACT FROM AUTHOR]