Producer price index, 15 November 2006

The producer price index (PPI) fell by 1.6 per cent from October to November. This was the third consecutive month with a decline in the over all index. Main contributors to the index slump were prices of oil and electricity. Electricity prices continued on a relatively steep downward path, with a fall of 10.7 per cent last month, while the oil price saw a 2.2 per cent decline. Both of these rates are similar to those from September to October, which were -11.0 and -2.0, respectively. Following the last months' development, the oil price is not very far from its level in the same month of last year. The index of oil prices was 3 per cent higher in November this year compared with November of last year. Electricity prices, on the other hand, despite the past few months' decline, are nowhere near the level of last fall. The twelve-month growth rate of this index was 47.1 per cent to November.

A slight decrease for basic metals

Another sub-index with a rather high twelve-month growth rate is that for prices of basic metals. Despite a slight fall of 0.2 per cent last month, this index was 43.5 per cent higher in November than in the corresponding month last year.. The development of prices in this industry through 2006 looks quite exceptional: Steep, but also volatile.

By main industrial groupings, both intermediate goods and capital goods prices saw slight increases, 0.1 and 0.6 per cent, respectively, from October to November. The energy goods index is down for the third consecutive month, with a fall of 2.9 per cent. Consumer goods are classified as either durable or non-durable, based on their assumed useful life span. The index for the former group was unchanged since October, while that of the latter fell by 0.1 per cent.

November 2005 to November 2006: A total rise of 6.8 per cent

Since November 2005, the PPI has increased by 6.8 per cent. The price index for oil was 3.0 per cent higher this November compared with the last. According to the revenue share of oil in the Norwegian economy, this sub-index is dominant in the total index. The indexes for manufacturing and electricity have contributed to the total with increases of 7.6 and 47.1 per cent, respectively, over the year to November.