July 10, 2024 at 12:50AM
Still solid rises for inflation at the wholesale level.
USD/JPY is little changed around 161.36
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The Producer Price Index (PPI) in Japan is also known as the Corporate Goods Price Index (CGPI)
its a measure of the average change over time in the selling prices received by domestic producers for their output
is calculated by the Bank of Japan
Unlike the Consumer Price Index (CPI), which measures the price change that consumers see for a basket of goods and services, the CGPI focuses on the change in the prices of goods sold by companies.
The PPI reflects some of cost pressures faced by producers
its based on a basket of goods that represents the range of products produced within the Japanese economy, including items such as:
raw materials like metals and chemicals
semi-finished goods
and finished products
different weights are assigned to each category within the index based on its contribution to the overall economy.
it does not account for the quality improvements in goods and services over time, which might lead to overestimation of inflation
additionally, it reflects only the prices of domestically produced goods, leaving out the impact of imported goods
The PPI can be used as a guide to inflationary pressures in the economy:
If producers are facing higher costs, they may pass these on to consumers, leading to higher consumer prices.
This article was written by Eamonn Sheridan at www.forexlive.com.
