more soon
—
The Producer Price Index (PPI) in Japan is also known as the Corporate Goods Price Index (CGPI).
- it is a measure of the average change over time in the selling prices received by domestic producers for their production.
- is calculated by the Bank of Japan
Unlike the Consumer Price Index (CPI), which measures the change in prices that consumers see for a basket of goods and services, the CGPI focuses on the change in prices of goods sold by businesses .
The PPI reflects some of the cost pressures facing producers
- it is 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 products
- and finished products
- Different weights are assigned to each category within the index based on its contribution to the overall economy.
- it does not take into account improvements in the quality of goods and services over time, which could lead to an overestimation of inflation
- furthermore, it only reflects the prices of locally produced goods, leaving aside the impact of imported goods.
The PPI can be used as a guide to inflationary pressures in the economy:
- If producers face higher costs, they may pass them on to consumers, leading to higher consumer prices.
cnbctv18-forexlive
