MK Producer Price Index YoY: November 2025 Analysis and Macro Outlook
The Producer Price Index (PPI) for MK rose 4.50% YoY in November 2025, up from 4.20% last month, signaling a moderate inflationary pressure easing from earlier 2025 peaks near 7.30%. This shift reflects cooling input costs amid tighter monetary policy and subdued external demand. The PPI trajectory suggests a cautious but stable inflation environment, with risks balanced between global commodity volatility and domestic fiscal stimulus. Market reactions were muted, with currency and bond yields showing limited immediate response.
Table of Contents
The latest Producer Price Index (PPI) YoY for MK registered a 4.50% increase in November 2025, matching consensus estimates and marking a slight uptick from October’s 4.20%. This figure continues the downward trend from the early 2025 highs exceeding 7%, reflecting easing cost pressures on producers. The geographic scope covers the entire MK economy, with data sourced from the Sigmanomics database, ensuring comprehensive coverage of industrial and manufacturing sectors.
Drivers this month
- Energy prices stabilized, contributing 0.12 percentage points (pp) to PPI growth.
- Intermediate goods inflation slowed, reducing contribution by -0.08 pp.
- Food processing costs edged higher, adding 0.10 pp.
Policy pulse
The 4.50% PPI reading remains above the central bank’s inflation target range of 2-3%, suggesting persistent but manageable inflationary pressures. The National Bank of MK’s recent rate hikes appear to be moderating producer price growth without triggering sharp disinflation.
Market lens
Immediate reaction: The MKD currency showed a mild 0.10% appreciation against the EUR within the first hour post-release, while 2-year government bond yields edged up 3 basis points, reflecting cautious optimism about inflation control.
Core macroeconomic indicators provide context for the PPI trajectory. MK’s GDP growth slowed to 2.10% YoY in Q3 2025, down from 2.80% in Q2, reflecting weaker external demand and tighter financial conditions. Consumer Price Index (CPI) inflation remains elevated at 5.20% YoY, above the central bank’s target but trending down from 6.70% in mid-2025.
Monetary Policy & Financial Conditions
The National Bank of MK has raised policy rates by 125 basis points since March 2025, aiming to curb inflation. Credit growth has decelerated to 3.50% YoY from 6.00% earlier in the year, indicating tighter financial conditions. The PPI’s moderation aligns with these monetary tightening effects.
Fiscal Policy & Government Budget
Fiscal stimulus remains supportive but restrained. The government’s budget deficit narrowed to 2.80% of GDP in Q3 2025, down from 3.50% in Q2, reflecting improved tax collection and controlled spending. This fiscal discipline helps limit demand-pull inflation pressures on producer prices.
External Shocks & Geopolitical Risks
Global commodity prices have stabilized after mid-year volatility caused by geopolitical tensions in Eastern Europe. MK’s export markets remain vulnerable to supply chain disruptions, but recent easing of trade frictions has reduced immediate cost pressures on producers.
This chart confirms a clear downward trajectory in MK’s PPI over the past eight months, trending toward stabilization. The recent uptick is a minor deviation within a broader easing pattern, indicating that inflationary pressures on producers are moderating but remain present.
Market lens
Immediate reaction: Following the release, MKD/USD showed a slight strengthening of 0.15%, while short-term bond yields rose modestly, reflecting market confidence in controlled inflation but caution over persistent cost pressures.
Looking ahead, the PPI trajectory will be shaped by several key factors. The central bank’s continued monetary tightening is expected to further temper producer price inflation. However, external risks such as commodity price shocks and geopolitical instability could disrupt this trend.
Bullish scenario (30% probability)
- Global commodity prices decline sharply, easing input costs.
- Monetary policy successfully anchors inflation expectations.
- PPI falls below 3% by mid-2026, supporting real income growth and investment.
Base scenario (50% probability)
- Gradual easing of inflationary pressures with PPI stabilizing around 4%.
- Monetary policy maintains a cautious stance, balancing growth and inflation.
- Moderate fiscal stimulus supports demand without overheating the economy.
Bearish scenario (20% probability)
- Renewed geopolitical tensions push commodity prices higher.
- Supply chain disruptions increase production costs.
- PPI rises above 6%, forcing aggressive monetary tightening and risking recession.
Policy pulse
The central bank is likely to maintain a vigilant approach, adjusting rates as needed to keep inflation expectations anchored near target. Fiscal authorities may also adjust spending to avoid exacerbating inflation.
In summary, MK’s Producer Price Index YoY reading of 4.50% in November 2025 signals a continued but moderated inflationary environment. The downward trend from earlier 2025 highs reflects effective monetary policy and easing external pressures. However, risks remain from global commodity markets and geopolitical uncertainties. Market sentiment remains cautiously optimistic, with financial conditions tightening but not yet restrictive.
Investors and policymakers should monitor PPI alongside CPI and core inflation metrics to gauge underlying price pressures. The balance of risks suggests a stable but vigilant macroeconomic stance is warranted in the near term.
Key Markets Likely to React to Producer Price Index YoY
The Producer Price Index YoY is a critical gauge of inflationary pressures that influence currency valuations, bond yields, and equity sectors sensitive to input costs. Markets tracking MK’s PPI closely include financial instruments tied to inflation expectations, commodity prices, and domestic economic growth.
- MKDEUR: The MKD/EUR currency pair reacts to inflation data as it influences monetary policy and trade competitiveness.
- MKIND: Industrial sector equities are sensitive to producer cost changes reflected in the PPI.
- MKFIN: Financial sector stocks respond to interest rate expectations driven by inflation data.
- MKDBTC: Cryptocurrency pairs involving MKD may reflect shifts in inflation hedging demand.
- USDMKD: The USD/MKD pair is sensitive to inflation surprises impacting monetary policy divergence.
Insight: PPI vs. MKIND Since 2020
Since 2020, MKIND (MK Industrial Sector Index) has shown a strong positive correlation with MK’s PPI YoY. Periods of rising PPI, such as early 2025’s peak at 7.30%, coincided with increased input costs squeezing margins, leading to volatility in MKIND. Conversely, the recent PPI decline to 4.50% has supported a modest recovery in MKIND, indicating easing cost pressures are improving industrial profitability.
| Year | Average PPI YoY (%) | MKIND Annual Return (%) |
|---|---|---|
| 2020 | 3.20 | 5.10 |
| 2023 | 6.50 | -2.30 |
| 2025 (YTD) | 5.90 | 1.80 |
FAQs
- What does the MK Producer Price Index YoY indicate?
- The MK Producer Price Index YoY measures the average change in prices received by producers for their goods compared to the same month last year, indicating inflationary trends in production costs.
- How does the PPI affect monetary policy in MK?
- The PPI influences the National Bank of MK’s decisions by signaling inflationary pressures. Persistent PPI increases may prompt rate hikes to control inflation.
- Why is the PPI important for investors?
- Investors use the PPI to anticipate inflation trends, which affect interest rates, corporate profits, and currency values, guiding investment strategies.
Takeaway: MK’s November 2025 PPI YoY reading of 4.50% confirms a moderating inflation trend, balancing easing cost pressures with persistent risks, warranting cautious optimism for the economy and markets.
MKDEUR – MKD/EUR currency pair, sensitive to inflation and monetary policy in MK.
MKIND – MK Industrial Sector Index, correlates with producer price inflation.
MKFIN – MK Financial Sector Index, impacted by interest rate shifts from inflation data.
MKDBTC – MKD/BTC crypto pair, reflects inflation hedging demand.
USDMKD – USD/MKD currency pair, reacts to inflation surprises and policy divergence.
The November 2025 PPI YoY reading of 4.50% marks an increase from October’s 4.20%, yet remains well below the 12-month average of 5.90%. This reflects a steady deceleration from the peak of 7.30% recorded in March 2025. The chart below illustrates this downward trend, highlighting the impact of monetary tightening and easing commodity prices.
Compared to the previous month, the 0.30 percentage point rise suggests some short-term volatility, likely driven by seasonal factors in food processing and energy sectors. However, the overall trend remains downward, signaling a gradual normalization of producer price inflation.