PPI Growth Comparison Graph
One of several price indices, the Producer Price Index (PPI Index) measures the average changes in prices received by domestic producers for their output. The PPI Index is often used as a predictor of consumer price index. In theory, the price increases incurred by retailers will be passed on to the consumer, thereby affecting the CPI. Investors will sometimes watch the Producer Price Index, then, in an attempt to determine upcoming movements in the CPI.