Producer Price Index (PPI).
In plain English
The Producer Price Index, or PPI, tracks the average change in the selling prices that domestic producers get for their output, measured and published monthly by the Bureau of Labor Statistics. Because it captures price pressure earlier in the pipeline, at the wholesale and production stage, it is watched as a leading hint of where consumer prices might go. It is the producer-side companion to the Consumer Price Index, which measures what households pay at the checkout. The latest reading always comes from the BLS release, not from memory.
01Why it matters
PPI can flag inflation building before it reaches store shelves, so markets and the Fed read it as an early warning, and knowing what it measures helps you interpret an inflation story that cites it.
02The math, step by step
If the prices factories and suppliers charge start rising, PPI picks that up. Some of that cost often gets passed along to shoppers later, showing up in the Consumer Price Index down the road. That lead-time is why analysts watch PPI as a signal.
03What this is NOT
It is not the CPI. PPI measures prices producers receive; CPI measures prices consumers pay. They move together over time but not identically, and PPI often shifts first because it sits earlier in the supply chain.
04Receipts
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