The industrial producer price index is likely to respond more quickly to price changes than are the other indexes,so it is regarded as a warning sign of inflation.

Question

Quizplus · Accepted Answer

This is true because the industrial producer price index measures the prices of goods and services at the producer level, before they are passed on to consumers. Thus, it reflects changes in input costs for producers and can signal potential increases in consumer prices down the road.

The Industrial Producer Price Index Is Likely to Respond More