A business that buys materials, parts or fuel reads price changes on its suppliers' invoices. The Producer Price Index is the government's measure of prices at that stage. For final demand, it rose 1.3 percent in September and 6.3 percent over the 12 months that ended in September, the Bureau of Labor Statistics said on Oct. 15.

The October figures are scheduled for release on Friday, Nov. 13, at 8:30 a.m. Eastern time, according to the BLS.

What it measures

The BLS says the PPI "measures the average change over time in the selling prices received by domestic producers for their output. The prices included in the PPI are from the first commercial transaction for many products and some services."

Two parts of that definition matter. The prices are what producers receive, not what a shopper pays at the register. And they are taken at the first sale, when goods and services move from the company that made them to the next buyer.

That next buyer is often another business. A shop that buys steel or a contractor that buys lumber is often buying at the stage the index is built to capture.

The September report

Goods rose faster than services in September. Goods prices rose 2.6 percent and services prices rose 0.8 percent, the BLS said.

Within goods, energy prices rose 10.8 percent and gasoline prices rose 20.3 percent in the month. Prices for goods less foods and energy rose 0.3 percent.

The 6.3 percent increase over 12 months was the largest since a 6.4 percent rise in December 2022, according to the BLS.

Why a small firm watches it

A business that runs delivery vans or heats a workshop buys energy every week. A 20.3 percent monthly rise in producer prices for gasoline is the kind of change that can show up in that firm's fuel bills, whether or not it shows up in the firm's own prices.

The split between goods less foods and energy, up 0.3 percent, and energy, up 10.8 percent, also matters for planning. For a firm whose main costs are materials other than fuel, the index closest to its inputs rose far less in September than the one for energy.

The PPI is an average across many industries. It does not show what any one supplier charged, and a firm's own invoices remain the closer measure of its costs.

Revisions

The September figures are not final. BLS data are subject to revision up to four months after publication, the agency says. The September numbers released on Oct. 15 can change in later reports.

Friday's release

The October report arrives at 8:30 a.m. ET on Friday. Reuters reported that the producer price data could shape inflation expectations after consumer prices rose more than expected.

For a business owner, the report is a published reading of what producers received for their output in October. It sits alongside the invoices already on the desk.