Top 5 inflation indicators procurement teams should monitor to stay ahead

In 2025, procurement leaders face one of the most challenging pricing environments of the last decade. Inflationary pressures, while easing in some regions, continue to fluctuate unpredictably across categories, geographies, and supply chains. For global procurement teams, this volatility translates into heightened risk for category planning, supplier relationships, and budget forecasting. 

Missing early signals of inflation can mean locking into unfavorable contracts, overpaying for materials, or losing negotiating leverage with suppliers. In high-inflation environments, proactive monitoring of leading indicators is no longer a “nice-to-have” -it’s a competitive necessity. 

The following five inflation indicators offer procurement professionals actionable insight into potential cost escalations, and when tracked together, they provide an early-warning system that can protect margins and strengthen sourcing strategies. 

1. Producer Price Index (PPI) – Your window into supplier cost pressures 

The Producer Price Index (PPI) measures the average change over time in selling prices received by domestic producers for their output. While the Consumer Price Index (CPI) reflects what buyers pay, PPI gives procurement teams a direct view into supplier-side cost movements. 

• Why it matters for procurement: 
  PPI changes often precede CPI changes, making it a leading indicator of future consumer price shifts. For B2B categories, PPI can directly flag cost escalations in raw materials, intermediate goods, and finished products. 
• Practical use case: 
  If PPI for a key input like steel jumps 5% month-over-month, it’s a clear signal that suppliers may soon push for price increases. With this data, procurement can pre-emptively renegotiate terms or seek alternate sourcing. 

Don’t just look at the overall PPI, track PPI by relevant category. For example: 

• Metals PPI for industrial manufacturing 
• Chemicals PPI for coatings and plastics 
• Food PPI for agricultural inputs 

Beroe’s AI-powered cost intelligence platform, Inflation Watch, integrates PPI data across major regions and countries, allowing procurement teams to compare cost pressures globally and act before price hikes hit their contracts. 

2. Consumer Price Index (CPI) – Indirect impact and demand signals 

The Consumer Price Index measures the average change over time in the prices paid by consumers for goods and services. While this is often discussed in macroeconomic contexts, it’s equally relevant for procurement. 

• Why it matters for procurement: 
  Rising CPI doesn’t just affect households, it signals shifts in consumer demand that can cascade through supply chains. If consumers cut back due to rising prices, suppliers may lower production volumes, creating ripple effects on input availability and pricing. 
• Practical use case: 
  If CPI for energy spikes in Europe, consumer spending on discretionary items may fall. Procurement teams in the apparel or electronics sector could then anticipate reduced supplier capacity or renegotiated order volumes. 

Tracking CPI by region helps global procurement leaders understand market-specific demand pressures and anticipate how those might influence supplier pricing behavior. 

3. Raw material and commodity indices – Direct category cost drivers 

Few indicators have as immediate and direct an impact on procurement costs as raw material and commodity indices. These measure price movements in essential inputs like metals, chemicals, agricultural products, and energy. 

• Why it matters for procurement: 
  Many category costs are highly correlated with commodity price trends. A sustained increase in crude oil prices, for example, can drive up the cost of plastics, synthetic fibers, and transportation. 
• Practical use case: 
  Monitoring indices like the London Metal Exchange (LME) Copper Price can give procurement professionals an early read on cost pressures before they materialize in supplier quotes. 

In 2025, geopolitical tensions, extreme weather events, and ever-changing tariff regulations are all contributing to heightened commodity price volatility. That makes it critical for procurement teams to have real-time access to trusted index data, ideally integrated with supplier spend mapping to see the direct impact on category budgets. 

Beroe's Inflation Watch aggregates commodity indices across direct and indirect categories, spanning multiple regions and countries, to produce both commodity and category-level forecasts – enabling procurement teams to connect micro and macro trends directly to their sourcing strategies. 

4. Wage growth and employment costs – Hidden inflation in services and labor-intensive categories 

Inflation is not only about goods – services categories can be equally impacted by rising labor costs. Wage growth and employment cost indices track how much employers are paying for labor, including salaries, benefits, and bonuses. 

• Why it matters for procurement: 
  In categories such as logistics, facilities management, IT outsourcing, or construction, labor costs often make up a significant share of total cost. Even if raw material prices remain stable, wage growth can drive up contract values. 
• Practical use case: 
  If wage growth accelerates in Southeast Asia’s manufacturing sector, procurement teams sourcing labor-intensive products from the region could see increased unit prices or pressure to adjust contract terms. 

By tracking wage growth or billing rate data for services by region and industry, Beroe can help procurement teams proactively renegotiate SLAs, explore automation opportunities, or diversify sourcing locations to manage cost escalation risk. 

5. Supply chain disruption indices – Early inflation signals in logistics and components 

Supply chain disruption indices, like the Global Supply Chain Stress Index (GSCSI), measure the frequency and severity of events that affect the flow of goods, from port congestion and transport strikes to extreme weather and geopolitical conflicts. 

• Why it matters for procurement: 
  Disruptions tighten supply, and when supply falls while demand holds steady, prices rise. This effect can happen quickly, making disruption indices one of the most time-sensitive inflation indicators. 
• Practical use case: 
  If a disruption index spikes for semiconductor supply chains due to factory shutdowns, procurement teams in electronics manufacturing can expect short-term price surges and plan buffer inventories or alternate sourcing. 

Tracking these indices enables rapid response — securing supply before shortages become acute and prices surge further. 

Putting it all together – An integrated inflation monitoring strategy 

Monitoring each of these five indicators in isolation can provide valuable insight. But when combined, they deliver a multi-dimensional view of inflation risk. For example: 

• PPI and CPI together reveal the cost push vs. demand pull dynamics in a market. 
• Commodity indices offer clarity on category-specific drivers. 
• Wage growth data complements PPI by capturing service-sector cost pressures. 
• Supply chain disruption indices add the real-time dimension, flagging near-term risks. 

The challenge for most procurement teams is data fragmentation — these indicators come from multiple sources, update on different schedules, and require interpretation in the context of specific categories and geographies. That’s where a solution like Beroe’s Inflation Watch becomes indispensable. 

How Beroe’s Inflation Watch gives you the edge 

Our cost intelligence platform provides procurement teams with a clear view of inflation exposure and comprehensive insights into cost trends, enabling them to navigate market volatility and make precise, contextualized budgeting decisions.  

• Track inflation for 13,500+ grade location combinations of feedstocks and input materials, along with 2,100+ pre-built cost structures  
• Access cost driver intelligence, contextualized by region and category 
• Review forecasts, indices, and inflation alerts 
• Simulate the financial impact of inflation at product line, business unit, and regional levels, visualising exposure and adjusting strategies to mitigate risks and optimise budgets 
• Benefit from 19+ years of experience in price forecasting, with accuracy rates consistently exceeding 95%. 

In volatile markets, speed and foresight are everything. Inflation Watch turns fragmented data into actionable intelligence, helping procurement professionals protect margins, negotiate from a position of strength, and adapt with agility to market shifts. 

The cost of waiting 

By the time price increases reach your desk, your negotiating position may already have weakened. The most successful procurement organizations in 2025 will be those that: 

• Track leading inflation indicators continuously 
• Interpret them in the context of their category mix and geographic footprint 
• Act decisively on early signals 

Beroe’s Inflation Watch makes this possible, turning data into an always-on competitive advantage. 

Act now 

Gain real-time visibility into the inflation drivers that matter most to your categories and geographies. Book a demo of Inflation Watch today and see how you can monitor the world’s most important inflation indicators in one place.