Producer Price Index Rises In July – May Be An Indicator To Tomorrow’s CPI Report

Please Note: This is the Producer Price Index (PPI), not the Consumer Price Index (CPI). The Consumer Price Indices (CPI-U, CPI-W, and C-CPI-U) will be published tomorrow, August 18, at 8:30AM EDT. I will have my 2012 COLA Watch up tomorrow night.

The PPI is a measure of prices at the producer level (essentially the wholesale prices) for finished goods. It is usually a fair indicator of what the CPI will do.  Quotes (in italics) are from the Bureau of Labor Statistics’ news release.

The Producer Price Index for finished goods rose 0.2 percent in July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This advance followed a 0.4-percent decrease in June and a 0.2-percent rise in May.

In April, the PPI increased 0.8%

In April, the CPI-W increased 0.78%, in May it increased 1.01%, and in June it decreased by 0.2%. While there is not an exact correlation between the PPI and the CPI, some portion of any increase or decrease in wholesale prices should make it through to consumers fairly rapidly.

For more details, please refer to Producer Price Index News Release text.

Anyway, we’ll all know what the CPI-W is tomorrow.

Advertisements
This entry was posted in 2012 COLA Watch. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s