Producer price index rose by 2% in Q4 of 2017: Instat

The producer price index rose by 2% in the last quarter of last year. According to Instat, the growth was at the same level as in the third quarter, while last year’s trend for this indicator is upward.

Since the end of 2016, the index of production prices has returned to positive values, which warns of an increase in pressures for higher inflation of consumer prices.

The production price index measures the prices with which they are marketed by the producers, thus giving an orientation over consumer prices in the immediate future.

If manufacturers raise prices, more likely this increase will also be reflected in the prices with which consumers buy retail goods.

An increase in production prices is important for enterprise performance, as it implies more incentives to increase output, employment, and wages in the future.

According to INSTAT, the growth in domestic production prices for the fourth quarter was driven by industry output, by 7.8%, while specifically the growth in the oil extraction sector was 11.7% higher compared to the same period of last year.

As far as the processing industry is concerned, the sector that holds more weight in production, growth in the fourth quarter 2017 was somewhat contained, at 1.6%.

However, in the segment affecting most consumers, namely, that of food and beverage industry, the production price index remains negative, which means prices are still falling.

This is largely related to low prices of imported raw materials but also to a still unconstrained domestic demand.

The PPI compares the average costs of a standard set of products, often called a basket of goods, over time at the wholesale level. Wholesale, meaning, the cost before a product gets to the consumer.

SCAN

*Material i përgatitur nga portali SCAN. Ripublikimi mund të bëhet vetëm kundrejt citimit të autorësisë dhe burimit origjinal.