PPI (Producer Price Index) is a standardized index.

It can be understood as the average price of major commodities.

For example, last year's CPI was 100.

This year's is 98.

Explain that the overall level of commodity prices faced by consumers has dropped.

Then the inflation rate is 98- 100/ 100=-2%.

There has been deflation.

If it is higher than 100 this year,

This means that the inflation rate is greater than 0.

consumer price index (CPI)

There is no standard to measure PPI figures.

Mainly compared with last year.

In other words, what matters is the inflation rate.

Not these indices.

It is best to keep the inflation rate at a low level.

If it is negative, it shows signs of economic recession.

serious

If it is too high

Explain that the economy is overheating.

Not good either.