Long Term Perspective

Prices will increase or decrease at earlier stages of production before consumers pay more (less) for finished goods. Changes in prices of food and energy products tend to overshadow changes in prices of other goods. From 2003 and through mid-2006, intermediate goods price gains have been at strong year-on-year rates not seen since the early 1980s. Since mid-2006, rates have swung down and then back up, reflecting swings in oil prices.

Short Term Perspective

The intermediate goods index as well as the crude materials index slowed sharply late in 2006 and early 2007 due to lower oil prices but rebounded later in the year as oil prices backed up.