Producer price index, 15 October 2001

The producer price index fell 10 per cent from September to October. This was mainly caused by reduced prices of crude oil. Changes in the prices of crude oil are decisive for the price development of refined oil products, and due to that also the price development in manufacturing.

Price development from September to October: Manufacturing prices fell 1.6 per cent

The price decreases for refined oil products and for basic metals were the most important explanation for the drop in manufacturing. Prices for refined oil products fell by 13.2 per cent while basic metals fell by roughly 4 per cent.

The prices within food products, beverages and tobacco increased by 0.8 per cent. Several product groups showed price increases, among others meat and meat products.

The consumer goods aggregate among the main industrial groupings showed an increase of 0.8 per cent. All the other groups registered a price decrease.

12-month rate, October 2000 - October 2001: Manufacturing prices down 4.3 per cent

A fall in the prices of refined oil products by 27 per cent is the main explanatory variable to the drop in manufacturing prices since last year. Another important contributor was the price in basic metals, which fell 16.8 per cent. Prices of food products counteracted some of the decline in manufacturing prices by an increase of 4.4 per cent.

Prices of crude oil were about 37 per cent lower than last year, which made oil and gas extraction end up with a negative 31.8 per cent. Together with the price decrease in manufacturing this contributed to a 19.1 per cent drop in the 12-month rate for the total index in October.

Development in the 12-month rate: Rate of growth still down

The downward tendency in the producer price index continued from September to October. Within manufacturing the 12-month rate fell from -2.1 per cent to -4.3 per cent. Since June 2000 the 12-month rate has decreased from more than 11 per cent.

The downward tendency in the manufacturing prices is mainly caused by the price decline in refined oil products and basic metals. Since October last year, the prices of refined oil products have declined by 27 per cent, after nearly -15 per cent last month. Prices of basic metals went from a negative 12.3 per cent to a negative 17 per cent in October. As opposed to this is the price development within food products, beverages and tobacco. The prices in this group increased 4.4 per cent since last year, after 3.8 per cent in September.

All the main industrial groupings had lower 12-month rates than in September, with the exception of consumer goods. Consumer goods went from 3.6 per cent in September to 4.2 per cent in October.