Just to state the obvious, once certain inflation perceptions persist in the public’s opinion they will not be corrected by technical explanations of statistical methodologies. A credible track record of reliable official statistics – and this applies beyond the measurement of inflation – is of utmost importance in this situation.
In September, PPI and CPI were up by 10.7% and 0.7% y-o-y respectively. The rapid increase in PPI can be largely explained by rising raw material prices, such as energy and metals. We expect the PPI to remain high for a few months before the upward pressure wanes at the end of this year.