Economic Indicator: Producer Price Index (PPI)

What is the producer price index (PPI)?

The Bureau of Labor Statistics (BLS) calculates the producer price index. The PPI is a weighted average family of indexes of price changes of various domestic producer wholesale goods, manufacturing services and commodities. The PPI used to be called the wholesale price index (WPI) and can be used as an indicator of inflation or producer price increases.

What’s the difference between PPI and CPI?  CPI is the consumer price index and tracks price changes for domestic consumer goods and services – these are the prices consumers pay versus the prices wholesalers or producers pay for various goods and services.

Over 10,000 PPI categories are tracked monthly by the BLS. Some main PPI categories include:

  • Food and beverages
  • Housing
  • Apparel
  • Medication
  • Transportation
  • Recreation
  • Education
  • Communication
  • Personal services

 

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