Producer Price Index (PPI)

Producer Price Index (PPI)

PPI is a measure of the average price level for a fixed basket of capital and consumer goods paid by producers. The PPI measures price changes in the manufacturing sector. It measures average changes in selling prices received by domestic producers in the manufacturing, mining, agriculture, and electric utility industries for their output. Inflation at this producer level often gets passed through to the consumer price index (CPI). The relationship between inflation and interest rates is the key to understanding how data like the PPI influence the markets and your investments.