The producer’s monthly inflation decreased to 3.2% in May

According to the economic reporter of Fars news agency, the information obtained from informed sources indicates a noticeable decrease in the monthly producer inflation last month (May 1402). The producer price index (PPI) inflation, which reached 5.8% in May 1400 and 9.7% in May 1401, has decreased to 3.2% in May this year.

According to the definitions and concepts used in international standards, this index shows a measure of the change in the price of goods and services that are purchased by the producer and sold after the production of the final product, so the producer price index is the change in the general level of the price of the sold products. It is measured by the producer at the origin of the sale (factory door price).

Monthly inflation of producer price index (percentage)

* Signal of consumer inflation reduction

The producer price index, which is considered as a leading indicator for checking the price index of consumer goods and services, is known among the people of the economy as a measure of production costs, and accordingly, the consumer inflation signal is received from it. In other words, production inflation (PPI) shows itself after some time in the form of consumer inflation (CPI).

Now, if the production inflation is decreasing, it will send the message to the society about the decrease in the general level of prices. Based on this, it seems that in the coming months, we should wait for the fever of inflation to subside in recent months.

* Steering towards the long-term average

The monthly inflation of the producer price index, which recorded 3.2% in May of this year, has been associated with a relative increase compared to April of this year, as in previous years.

The seasonal pattern of monthly inflation in the first two months of each year is such that the monthly inflation of April usually has far higher figures than the monthly inflation of April, and this inflationary behavior is also clearly evident in the years 1400 and 1401.

The important point in this regard is the significant decrease in the monthly inflation in May 1402 compared to May 1401 and 1400, so that the monthly inflation in May 1400 and 1401 was 5.8 and 9.7 percent, respectively, with a significant decrease to It reached 3.2 percent in May of this year.

The average monthly inflation rate of producer price index in April and May between 1390-1402 was equal to 1.6 and 2.7 percent, respectively. In this way, with the monetary and foreign exchange policies of the government, the average production inflation rate will be controlled and directed towards the long-term average, which will increase the hopes for further reduction of consumer inflation.

Experts believe that part of this reduction is due to the management of foreign currency resources and expenses and to prevent the recent currency tensions from affecting the country’s production system in the framework of the Central Bank’s new foreign exchange policy. which had a great contribution in the management of currency fluctuations, in the continuation of the policy of stabilizing the currency of production equipment and machinery with an average rate of 28,500 Tomans was adopted from the winter of last year, which was welcomed by the producers, because they could adjust the production planning accordingly.

In general, it is expected that if the central bank’s foreign exchange support policies continue, we will continue to see the stability and reduction of producers’ costs in the coming months, and this has had a significant impact on the inflation of the consumer goods and services price index, and if your expectations are strengthened and improved, this reduction Continue with more intensity.

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