Macro • Shaul Koral

The Producer Price Index or PPI is one of the two most commonly used economic indicators (the other one being the Consumer Price Index or CPI).

The PPI measures the average change in prices paid to U.S. producers for their good and services.

It measures inflation from the producer’s perspective (as opposed to CPI which measures inflation from the consumer’s perspective).

The PPI is published monthly by the U.S. Bureau of Labor Statistics (BLS).

The BLS publishes about 10,000 indexes for individual products and industries.

These indexes cover nearly all industries in the U.S. economy.

The biggest thing everybody is looking at right now is the rate of inflation and the federal funds rate, as long as inflation isn’t coming down rates aren’t coming down. This may take some time, I see some speculate that rates will be coming down in 2023 but I’m skeptical that inflation will be that easy to tame.

My guess is that we’ll have “high” interest rates for at least a couple of years and then maybe, just maybe, they go down a little. But then again why would the fed decrease rates unless they broke something and we’re in a deep recession?

Since the Great Financial Crisis we were at historically low interest rates, it’s time to normalize.

Personal blog on investing and financial musings.

Category: Macro

Producer Price Index (PPI)

Macro thoughts of the day