Producer Price Index for Industrial Products increased by 3.2%

In comparison to June of the current year, Producer Price Index (PPI) for Industrial Products increased by 3.2 percent in July. Moreover, compared to the same period of last year, the index growth amounted to 10.7 %.

The information was released by the National Statistics Office of Georgia (Geostat). The agency reports that the prices for manufactured products increased by 2% compared to the previous month, resulting in a 1.66 percentage point contribution to the overall monthly PPI change.

Geostat says that a noteworthy price increase was registered for the following groups:

- Basic metals and fabricated metal products - 4.3 percent

- Food products, beverages and tobacco - 1.2 %

- Pulp, paper and paper products - 7.1 %

Also, the prices increased by 8% for products from mining and quarrying and contributed 0.54 percentage points to the change of the monthly index. Within the group, the prices increased for metal ores and other mining and quarrying products by 8.5 percent.

As for the annual PPI rate, it was mainly affected by price changes for manufactured products, where the prices increased by 12% contributing 9.59 percentage points to the overall annual index growth. In particular, the prices increased for the following groups:

- Food products, beverages and tobacco - 12.1 percent

- Basic metals and fabricated metal products - 16.1 %

- Pulp, paper and paper products -35.5 percent

In addition to this, the prices increased by 19.3 percent for products from mining and quarrying, contributing 1.25 % to the overall annual index growth.

However, the prices declined for electrical energy, gas, steam and hot water by 1.4 percent and contributed -0.13 percentage points to the overall annual PPI change.

If we have a look at the previous year statistics, the PPI was the highest in winter months. Since then Producer Price Index for Industrial Products kept declining until June 2019, when it amounted 105.2, a slight increase compared to 104.8 rates, observed in the previous months of this summer.

PPI is a group of indexes that calculates and represents the average movement in selling prices from domestic production over time. PPI is a product of the Bureau of Labor Statistics (BLS).

The PPI measures price movements from the seller's point of view. Conversely, the consumer price index (CPI), measures cost changes from the viewpoint of the consumer. In other words, this index tracks change to the cost of production.