Australian Q2 PPI +1.0% q/q (prior +0.9%) and +4.8% y/y (prior +4.3%)

Australian Q2 PPI

+1.0% q/q

• prior +0.9%

+4.8% y/y

• prior +4.3%

Lucky this isn’t CPI, a rise to 4.8% y/y from 4.3% would be a worry for the Reserve Bank of Australia.

And hopefully it doesn’t get passed on to consumers ’cause then it could well pressure CPI higher.

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The Producer Price Index (PPI) measures a change in input prices of raw, semi-finished or finished goods and services.

• If input costs rise, some will be absorbed by the producer and some passed on to the consumer. Conversely, if input costs fall, some of the decline will be enjoyed as wider profit margins by the producer and some will be passed on to the consumer in the form of lower prices.
• Because PPI impacts consumer prices, it is watched by central bankers as part of fulfilling their mandate of price stability.

This article was written by Eamonn Sheridan at www.forexlive.com.