China’s factory-gate prices surge by most in over 3 years

12-May-2021 Intellasia | Reuters | 5:02 AM Print This Post

China’s factory gate prices rose at the fastest rate in three and a half years during April, official data showed on Tuesday, as the world’s second-largest economy continued to gather momentum following record-setting growth in the January-March quarter.

The producer price index (PPI), a gauge of industrial profitability, rose 6.8 percent from a year earlier, the National Bureau of Statistics said in a statement, compared with a 6.5 percent rise tipped by a Reuters poll of analysts and a 4.4 percent rise in March.

China’s export growth beat market expectations in April while imports for the month hit a decade high, official data showed on Friday, underscoring robust economic activity for the world’s second-largest economy.

The country’s gross domestic product (GDP) expanded by a record 18.3 percent in annual terms in the first quarter as the country recovers from the devastating impact of COVID-19. Many economists expect China’s GDP growth to exceed 8 percent in 2021, although some warn that continuing global supply chain disruptions and higher comparison bases will sap some momentum in coming quarters.

The consumer price index (CPI) rose 0.9 percent in April from a year earlier, the statistics bureau said in a separate statement, compared with a 1.0 percent rise tipped by a Reuters poll of analysts and a 0.4 percent rise in March.

Despite rising pressure from imported global inflation, China’s full-year CPI is likely to be significantly below the official target of around 3%, deputy director at NBS Sheng Laiyun, said on Friday in an interview with Economics Daily.

Sheng attributed China’s likely muted inflation to currently slow core inflation, economic fundamentals where supply has outstripped demand, relatively restrained macropolicy support, recovering pork supply and a limited pass-through effect from PPI to CPI.

https://www.reuters.com/world/china/chinas-factory-gate-prices-surge-by-most-over-3-years-2021-05-11/

 

Category: China

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