The import price index measures the average price trends for goods imported from abroad. The price measurement relates to the import price. It includes the foreign ex works price, the trade margin, and the insurance and transport costs between the production site abroad and the border to the country of importation, but does not contain import duties (turnover tax on imports, customs duties, currency adjustment amounts).
The import price index is an instrument for measuring price trends from foreign markets and thus represents a key indicator for estimating the influences of prices from abroad on domestic inflation trends. In addition to general economic and business cycle analysis, the import price index is used by many market participants as a guide when monitoring the market. In addition, an import price index is used to deflate the external balance of goods and services in national accounts.