Producer Price Index (PPI)

What the PPI measures

The Producer Price Index (PPI) measures the average change over time in the selling prices that domestic producers receive for their output. Where the Consumer Price Index looks at what households pay, the PPI looks at what businesses are paid, generally at the first commercial transaction for a product or service.

That makes it a view of inflation from the supply side. It covers goods, services and construction, and it includes prices for things sold to other businesses, to government and for export, not only to consumers.

Who publishes it and when

The U.S. Bureau of Labor Statistics (BLS) publishes the PPI monthly at 8:30 AM Eastern Time. It usually lands within a day or two of the CPI, sometimes before and sometimes after, so the two reports are often read together. Each release brings together tens of thousands of price quotes and publishes thousands of individual indexes. Documentation and the latest release are on the BLS PPI home page.

The headline numbers

The PPI’s headline is the final demand index. “Final demand” means goods, services and construction sold to their final users rather than to another producer as an input. The release breaks it into:

• Final demand goods, split into foods, energy and core goods.
• Final demand services, split into trade, transportation and warehousing, and other services.
• Final demand construction.

Core PPI

There is no single official “core” PPI, which is a common source of confusion. Two measures get quoted:

• Final demand less foods, energy, and trade services. This is the measure BLS highlights in its release text, and the one most market coverage now means by “core PPI”.
• Final demand less foods and energy. An older, simpler core measure that some outlets still use.

The trade services piece is worth understanding. BLS measures trade services as the margins received by wholesalers and retailers, the gap between what they pay for goods and what they sell them for. Margins can swing sharply from month to month, which is why one core measure strips them out.

Intermediate demand

The release also reports intermediate demand indexes, which track prices for inputs that businesses buy from each other, organised by stage of production. These get less attention but can hint at cost pressure moving down the supply chain.

Why markets watch it

Two reasons stand out. First, the PPI is sometimes described as a leading signal for consumer prices: if producers face higher costs, they may pass some of them on. That link exists but is loose and inconsistent; plenty of producer price changes never show up in consumer prices.

Second, and more practically, some PPI components feed directly into the PCE price index, the inflation gauge the Federal Reserve targets. BEA builds most PCE prices from BLS consumer and producer price indexes, and for health care in particular, including physicians’ offices and hospitals, it uses PPI industry indexes. When the CPI and PPI are both out, forecasters translate them into an estimate of the PCE figure due later in the month, and that estimate can move markets.

How markets commonly react

A higher-than-expected PPI is commonly said to push Treasury yields up and weigh on stocks, for the same reasons as a hot CPI: it raises the chance of tighter Federal Reserve policy. In practice the PPI usually moves markets less than the CPI, and the reaction depends heavily on whether it confirms or contradicts the consumer price data released nearby. A sharp move in the volatile trade services component may be shrugged off entirely. None of these reactions are reliable.

Revisions

PPI figures are revised. BLS updates the indexes for up to four months after first publication to reflect late reports and corrections from respondents, so the month that made headlines may look different later. Seasonal factors are also re-estimated each year, and the new factors are applied to the previous five years of seasonally adjusted data.

Common misreadings

• Calling PPI “wholesale inflation”. The PPI covers services and construction as well as goods, and it is not a wholesale-only measure.
• Assuming a one-for-one pass-through to consumers. Businesses absorb, delay or offset cost changes in many ways.
• Comparing the wrong “core”. Check which core measure a headline is quoting before comparing it with a forecast.

For a side-by-side view of the three main inflation reports, see the guide to CPI, PPI and PCE.

Frequently asked questions

What time is the PPI released?

At 8:30 AM Eastern Time on the scheduled release day, before the stock market opens.

Is PPI more important than CPI?

For most market participants, no. CPI is generally the bigger market event. PPI matters mainly as a cross-check and because parts of it feed into the PCE price index.

What does “final demand” mean in the PPI?

It refers to goods, services and construction sold to their final users, such as consumers, government, businesses buying capital equipment, and foreign buyers, rather than inputs sold to another producer.

Why does the PPI change after it is published?

BLS revises each month’s figures for up to four months as late price reports and corrections come in.

Explainer updated November 13, 2026.