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Producer Price Index

2018-Q4 Reference

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Content

  • Definition
  • Salient Features
  • Composition of the index
  • Establishments Selection
  • Establishments Visits
  • Weights & Item Information
  • Index Calculation
  • Data Dissemination
  • Improvements

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Producer Price Index

PPIs measure the rate of change in the prices of goods and services bought and sold by producers..

Resident Producers:

  • Enterprises
  • Enterprise Groups
  • Kind-of Activity Units (KAU)
  • Establishments

Transferring the ownership:

  • Excludes [VAT, sales taxes, transportation, trade margins]
  • Includes [Net subsidies]

Price changes:

  • Short-term Changes
  • Long-term Changes

“PPIs measure the rate of change in the prices of goods and services sold by producers..” [Output PPIs]

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Salient Features of the PPI

References:

  • Weight : 2016 ASI
  • Price : 2018 Q4
  • Index : 2018 Q4

Section Coverage:

  • Agriculture
  • Manufacturing
  • Utility

Geographical Coverage :

  • All Island - Western, Southern, Central, North Central, North Western

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Composition of the PPI

Agriculture

Manufacturing

Utility

  • Perennial Crops
  • Non Perennial Crops
  • Animal Production
  • Food & Beverages
  • Tobacco
  • Textiles, Apparels
  • Printing
  • Petroleum
  • Chemicals
  • Rubber, Plastic
  • Metallic, Non-metallic
  • Transport, Furniture
  • Electricity
  • Water

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Establishments Selection

Sample:

  • 277-Establishments
  • Sections: 03, 2D-Divisions: 16, 3D-Groups: 22, 4D-Classes: 33

Sample Frame:

  • Annual Survey of Industry – 2016, with units classified by ISIC Rev.4
  • N = 1,158

Measure of Size:

  • Production Value (1,292 Billion Rupees)

Sampling Method:

  • Cutoff Method [95% - Cutoff Level]

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Establishments Visits

Methods:

  • Personal Visits [initiation visit]
  • Over the phone
  • Email

Separate 2 questionnaires:

  • Initiating Respondents
  • Collecting Price Updates

In an Initiation Visit:

  • Weight Information is collected
  • Items are Selected
  • Constant Quality Pricing
  • Initial Item Prices are Collected
  • Respondents are Instructed to completing Future Updates

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Weights & Items Selection

Weight Information and Item Selection:

Company : A

Output: 100 Mn Rs.

Production Line

1

2

3

Item Weight Share

50%

30%

20%

Item Selection:

  • Purposive Selection
  • Most Representative Transactions
  • Steadiness

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Monthly Data Collection & Index Compilation

15

The monthly item prices collect as of the 15th day of the month from 2018 October to Current

The Modified Laspeyres Index Method

 

Modified Laspeyres Index

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Data Dissemination

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Monthly index values release on 10th of each month with a 40 days lag.

Web Release

Infographic

Index Movement

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Improvements in the Updated Index

Expanded geographical coverage

  • The index now covers six provinces across the country.

Weights are parallel to the national account estimates

  • National accounts estimates of total market output were used to adjust the weights.

An advanced date to dissemination

  • Data dissemination is advanced by 5 days with the new release of PPI.

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Summary

Thank you!!