Farm Price Index - FPI

AAA

DEFINITION of 'Farm Price Index - FPI'

An index that monitors the prices received by farmers for sales including crops and livestock. The farm price index, which is released by the U.S. Department of Agriculture on a monthly basis, is a tool that analysts use as a leading indicator of inflation or deflation in the overall economy.

It is also known as the "Farm Products Price Index (FPPI)" or the "USDA Farm Price Index".

INVESTOPEDIA EXPLAINS 'Farm Price Index - FPI'

Farm prices are thought to be a leading indicator of food prices in the producer price index (PPI) and the consumer price index (CPI), and a sign of overall inflation or deflation. Because inflation (whether high or low) can have drastic effects on the investment markets, this is a valuable tool for predicting market movements.

RELATED TERMS
  1. IMF Nonfuel Commodity Index

    An index of nonfuel commodities developed and maintained by ...
  2. Consumer Price Index - CPI

    A measure that examines the weighted average of prices of a basket ...
  3. Producer Price Index - PPI

    A family of indexes that measures the average change in selling ...
  4. Investment Farm

    An agricultural business operation that is purchased and operated ...
  5. Economic Cycle

    The natural fluctuation of the economy between periods of expansion ...
  6. Gross Domestic Product - GDP

    The monetary value of all the finished goods and services produced ...
Related Articles
  1. Investing Basics

    Economic Indicators That Do-It-Yourself Investors Should Know

    Understanding these investing tools will put the market in your hands.
  2. Investing Basics

    The Barnyard Basics Of Derivatives

    This tale of a fictional chicken farm is a great way to learn how derivatives work in the market.
  3. Forex Education

    How To Trade Forex On News Releases

    When economic data comes out, it can have a marked impact on the currency market. Find out how to profit.
  4. Options & Futures

    Explaining The World Through Macroeconomic Analysis

    From unemployment and inflation to government policy, learn what macroeconomics measures and how it affects everyone.
  5. Investing

    What is GDP and why is it so important?

    The gross domestic product (GDP) is one the primary indicators used to gauge the health of a country's economy. It represents the total dollar value of all goods and services produced over a ...
  6. Active Trading

    Introduction To Stationary And Non-Stationary Processes

    What to know about stationary and non-stationary processes before you try to model or forecast.
  7. Retirement

    Economic Indicators To Know

    The economy has a large impact on the market. Learn how to interpret the most important reports.
  8. Forex

    What to Expect After the Swiss Currency Shock

    What to expect for the world economy after the Swiss currency shock.
  9. Markets

    What Cuba-US Relations Could Mean For U.S. Industry

    The restoration of diplomatic relations with Cuba could mean big profits for U.S. travel, agriculture, and financial services sectors.
  10. Economics

    How does a high discount rate affect the economy?

    Find out what would happen if the Federal Reserve decided to set a very high discount rate, the rate at which banks can borrow money from the Federal Reserve.

You May Also Like

Hot Definitions
  1. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  2. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  3. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  4. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  5. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  6. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
Trading Center