| Consensus | Consensus Range | Actual | Previous | Revised | |
|---|---|---|---|---|---|
| Month over Month | -0.1% | -0.2% to 0.1% | -0.2% | 0.2% | 0.3% |
| Year over Year | 2.8% | 2.5% to 2.9% | 2.7% | 2.6% | 2.5% |
Highlights
JAPAN AUG CORPORATE GOODS (PRODUCER) PRICES +2.7% Y/Y (JULY REVISED TO +2.5% FROM +2.6%); MEDIAN FORECAST +2.8%
JAPAN AUG PRODUCER PRICES -0.2% M/M, 1ST DROP IN 2 MONTHS (JULY REVISED TO +0.3% FROM +0.2%); MEDIAN FORECAST -0.1%
JAPAN PRODUCER ANNUAL INFLATION HAS SLOWED IN RECENT MONTHS ON FUEL SUBSIDIES, EASING DOMESTIC RICE SUPPLY SHORTAGES
JAPAN AUG CGPI M/M FALL LED BY LOWER COSTS FOR UTILITIES, FARM PRODUCTS, METAL PRODUCTS
JAPAN AUG PRODUCER INFLATION Y/Y RISE LED BY STILL HIGH FARM PRODUCE PRICES (+40.1% VS. +42.5% IN JULY)
JAPAN AUG CGPI Y/Y RISE EVEN AS KEY ENERGY PRICES CONTINUE FALLING; OIL/COAL PRODUCTS -1.5% VS. -2.0% IN JULY
JAPAN AUG PRODUCER PRICES -0.2% M/M, 1ST DROP IN 2 MONTHS (JULY REVISED TO +0.3% FROM +0.2%); MEDIAN FORECAST -0.1%
JAPAN PRODUCER ANNUAL INFLATION HAS SLOWED IN RECENT MONTHS ON FUEL SUBSIDIES, EASING DOMESTIC RICE SUPPLY SHORTAGES
JAPAN AUG CGPI M/M FALL LED BY LOWER COSTS FOR UTILITIES, FARM PRODUCTS, METAL PRODUCTS
JAPAN AUG PRODUCER INFLATION Y/Y RISE LED BY STILL HIGH FARM PRODUCE PRICES (+40.1% VS. +42.5% IN JULY)
JAPAN AUG CGPI Y/Y RISE EVEN AS KEY ENERGY PRICES CONTINUE FALLING; OIL/COAL PRODUCTS -1.5% VS. -2.0% IN JULY
Market Consensus Before Announcement
Producer inflation in Japan is expected to pick up to 2.8% on year in August after easing to an 11-month low of 2.6% in July from 2.9% in June in light of summertime fuel subsidies, slowly easing rice supply shortages and the import cost-cost cutting effects of a firmer yen.
Higher demand for non-ferrous metals, first in anticipation for easing trade conflicts, then in light of trade deals between Washington and its allies, have provided some support to the corporate goods price index in the past couple of months.
On the month, the CGPI is forecast to post its first drop in two months, down 0.1%, after rising 0.2% in July and slipping 0.2% in June. The increase in July was led by higher costs for fuels (gasoline, diesel, heavy fuels), utilities (electricity), farm produce (polished rice, pork, beef) and non-ferrous metals.
Higher demand for non-ferrous metals, first in anticipation for easing trade conflicts, then in light of trade deals between Washington and its allies, have provided some support to the corporate goods price index in the past couple of months.
On the month, the CGPI is forecast to post its first drop in two months, down 0.1%, after rising 0.2% in July and slipping 0.2% in June. The increase in July was led by higher costs for fuels (gasoline, diesel, heavy fuels), utilities (electricity), farm produce (polished rice, pork, beef) and non-ferrous metals.
Definition
The Producer Price Index (PPI) is a measure of the average price level for a fixed basket of capital and consumer goods paid by producers. Analysts look to the PPI for early signs of inflation in the production process.
Description
The producer price index focuses on the prices of goods transacted between companies. It was previously known as the corporate goods price index. The index reflects the price level for the supply and demand of individual industrial goods. This index is calculated by the BoJ Research and Statistics Department. Three indexes are contained in this release - the domestic producer index, the export price index and the import price index. It is the domestic index that market players follow. The PPI comprehensively tracks input price pressures; however, the PPI has a track record of increasing and not necessarily feeding through to the CPI because of weak demand. But if an increase in the PPI is followed by a rise in the CPI, concerns about inflation may prompt the Bank of Japan to raise interest rates.
