Producer price index
Measures price changes received by domestic producers for their output, 3,000 commodities, base year is 1982 (farm products, chemicals, rubber, paper)
The Producer Price Index (PPI) is a measure of the average change in the prices that domestic producers receive for their goods and services over time. It is used to track inflation at the producer level and is often seen as a leading indicator of consumer inflation.
The PPI covers a broad range of goods and services, including raw materials, intermediate goods, and finished goods. It is reported by the Bureau of Labor Statistics (BLS) on a monthly basis and includes data on both industry-based and commodity-based prices.
The PPI is calculated by comparing the price of a basket of goods and services in the current month to the price of the same basket in a base period. The base period is usually set to 100, and the index is then calculated as the percentage change in the price of the basket over time.
The PPI is an important economic indicator as it provides insight into the cost pressures facing producers in the economy. Increases in the PPI can lead to higher costs for businesses, which can then be passed on to consumers in the form of higher prices for goods and services.
Overall, the PPI is a valuable tool for policymakers, investors, and businesses alike, as it can help identify trends in the economy and inform important decisions related to monetary policy and investment strategies.
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