Base Year Revision Industrial Producer Price Index, 2010 = 100

Transcription

1 Centraal Bureau voor de Statistiek Postbus HADen Haag Base Year Revision Industrial Producer Price Index, 2010 = 100

2 Base year revision PPI, 2010 = 100 The Industrial Producer Price index is based on price information on goods and commodities produced, sold and/or imported by the Dutch industry sector. This price information is used to monitor price changes for a basket of goods and commodities representative for the base year. Price changes for higher aggregates are calculated as the weighted average of the changes in underlying product groups. The weights are chosen in proportion to the relative shares of the product groups in production in the base year. Because these relative shares change over time, the base year is updated every five years. For the current revision, the base year has been updated from 2005 to In the past, base year revisions have often been used as an opportunity to implement other improvements to the index series. This time, however, the base year revision focused exclusively on updating the weights. In other words: no changes were implemented with regard to the classifications and methodology used or the publication tables. More information on the methodology and data used in the compilation of the PPI is available on Statistics Netherlands website (Dutch). Transition to a new reference year The old index series with reference year 2005=100 are available for January 2000 to December 2012.No indices with reference year 2005=100 will be published for periods from January 2013 onwards. In March 2013, Statistics Netherlands switched to publishing PPI index series with reference year 2010=100. As these new series are available from January 2005 onwards, there is an overlap in the availability of old and new series for periods between January 2005 and December The new series with reference year 2010=100 can be found in their usual place in the Statline database (Prices > Producer prices). The old series with reference year 2005=100 have been moved to the archive (Archive > Prices). 1

3 Chain-linking For some purposes, e.g. indexation of contracts using PPI index series, it may be necessary to chain-link the old and new series. Statistics Netherlands recommends the following principles for this procedure: As far as possible price changes from one index series should be taken. Retrospective revisions and corrections should be avoided where possible. Taking these principles into account for the PPI index series results in the following practical recommendations: Use the series with reference year 2010=100 to determine the price change in a period that starts in or after December To determine the price change in a period that starts before but ends after December 2012, price changes from the 2005=100 and the 2010=100 series will have to be chain linked. Table 1: Chain-linking example!! Table 1 contains a fictitious example of chain-linking an index series for the period May 2003 to April The first step is to calculate the price change between May 2003 and December 2012 by dividing the respective index numbers from the 2005=100 series: / 92.7 = Calculate the price development between April 2013 and December 2012 similarly from the 2010=100 series: / = The price development for the entire period is then calculated by multiplying the price development by each other and subsequently by * * 100 =

4 Results The effect of the base year revision on the price development of manufacturing output is shown in figure 1. This graph shows the old and new series for the price index of output of manufacturing industries for the period 2005 to To make the series comparable, the old series (2005=100) has been rescaled to 2010=100. At the level of total industrial output, the base year revision has not had much impact on price developments. Figure 1: Price index of Manufacturing Industries Output (SBI 2008); 2010 = 100 At lower levels of aggregation, however, the changes in weights may have a more pronounced effect on price developments. Figure 2, for instance, shows the price development of basic pharmaceutical products and preparations. Figure 2: Price index NACE Rev2 Section 21, Manufacture of basic pharmaceutical products and preparations; 2010 = 100 3

5 Because of the large number of PPI series (approximately 500), it is unfeasible to discuss the effect of the new weights for all divisions and sections of the NACE and Prodcom classifications. However, appendices 1a and 1b provide an overview of the old and new weights at the level of 2-digits for both classifications. Further information For any further questions, please contact Statistics Netherlands Infoservice via the website 4

6 Appendix 1a:Weightsby Nace rev2, 2-digit level!!'() $(#$! + ),( -.( 5 ('(! ')! /0! /! &$ 1$!! $ )$)!1))! ''1))! 23&'((4 #$' 1)$#$!! ) ) ')) 2) ')$(# #$ )#$!!! / 5

7 %$3839# )5) 9($ % :9($4 913: 70 ) (// )$ 6#$$#$ / #$ '/) #$3&!#(3 $)$ $$ # 0$3$)#6 $!!!!!!!!!!!!!!!!!!!!!!!! '((! -#('( 7)$$'!!!! %$33 $!:$$3 #$!! 6

8 Appendix 1b:Weightsby Prodcom groups, 2-digit level '$) $ + ),( 5 ('()!!'()! $( ($!! '#$ -.( ') /0 / &$ 1$ $)$)!!!!!!!!!!!! 7

9 ! 1))'!! '1))23 &'((4! # $'1) $#$!! ) ) ' )) 2)') $(# #$) #$ / ) (//)$ 6#$$ #$ /#$!!!!!!!!!!!!!!!!!!!!!!!!!!!! 8

10 '/)#$ 3&! #(3$ )$ $$ #0$3 $)#6 $ '(( - #('( 7) $$'!!!!!!!!!!!!!!!!!!!!!!! 9

11 %$3839# )5) 9($ % :9($4 913: 70 %$33 $!:$$3 #$!!!!!!!!!!! 10