PPI Output YoY

The Producer Price Index (PPI) Output year on year (YoY) measures annual change in goods UK makers sell for domestic use. Factory gate price means the amount a maker receives, with margins plus labour, materials, energy, loan interest, maintenance and rent.

It covers CPA 2.1 (a European product code) sections A to E for plants coded 08 to 33 under SIC (a UK industry code). All figures leave out VAT (a sales tax), and the headline rate leaves out excise duty on tobacco, alcohol and fuel. It does not track consumer prices, services, inputs, exports or imports.

The Office for National Statistics (ONS) puts the index out monthly, about two to three weeks after the reference month. The bulletin gives dates only, with no release hour. Firms give prices for deals on or near the first of the month, inside 10 days of request, while full checks can take many months.

Data for the latest two months stay provisional, and data for the prior 12 months stay open to revision for late returns. It comes out with input prices, import and export prices, ten-group details and response rates. Any timetable change is announced with reasons.

Yearly change reflects 10 product groups combined by weight.

• Food products, 26.9%: factory foods for domestic sale such as dairy and bakery.
• Other outputs, 21.8%: plastics and repair services for metal products and machinery.
• Motor vehicles and other transport equipment, 14.8%: vehicles and gear for domestic sale.
• Basic metals, fabricated metal products and machinery, 12.9%: shaped metals and machines for domestic sale.
• Coke and refined petroleum products, 4.5%: refined fuel for domestic sale.
• Mixed light goods, 19.1%: paper 5.6%, chemicals 4.9%, alcohol and tobacco 4.3%, computers 3.2%, textiles 1.1%.

The June 2023 bulletin, released July 19, 2023, showed output up 0.1% on the year after 2.7% in May, with input down 2.7%. Refined petroleum fell 40.3% on the year, cutting 4.72 points from the rate, while 7 of 10 groups added upward pushes. Food rose 8.7% and added 1.95 points, while other outputs added about 1.53 points. Index levels stayed far above 2021 levels, so the lower rate showed base effects, not cheaper goods.

1. Price relative: prices for first-of-month deals from a statutory survey plus admin data on the same basis, as a ratio to the base period.
2. Weight: each product share of base-period sales after removing exports, with yearly price updating.
3. Laspeyres aggregation: the index sums each relative times its weight. Example: A with sales 60 and weight 0.6 and relative 1.05, B with 40 and 0.4 and 1.10, gives 107.0.
4. Annual chain-linking: each year starts a new base year with new weights, then scales the new series onto the old chain.
5. Year-on-year rate: the YoY rate is the 12-month change of the index (2015=100). If the index a year earlier was 104.0 and now is 107.0, the rate is 2.9%.
6. No seasonal adjustment: series are not seasonally adjusted (not smoothed for regular yearly patterns).