Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

China’s March Producer Prices Jump Most in More Than Two Years

Published 09/04/2021, 02:39
Updated 09/04/2021, 03:00
© Reuters.

© Reuters.

(Bloomberg) -- China’s producer prices climbed the most since July 2018 as commodity costs surged and the economy’s recovery strengthened. Consumer prices gained for the first time in three months.

  • The producer price index rose 4.4% in March from a year earlier after gaining 1.7% in February, the National Bureau of Statistics said Friday. The median forecast in a Bloomberg survey of economists was 3.6%
  • The consumer price index rose 0.4% from a year earlier

Key Insights

  • After months of deflation, producer prices have started to pick up sharply this year as the cost of oil, copper and agricultural goods rally
  • As the world’s biggest exporter, rising prices in China threaten to stoke global inflation further and add more turmoil to financial markets. Inflation risks are already mounting because of a stronger recovery in the world economy, massive fiscal stimulus in the U.S. and soaring shipping costs
  • For Chinese businesses, rising factory prices mean higher profits and more capacity to repay debt. Industrial profits more than doubled in the first two months of the year from the same period in 2020, recent data showed
  • Consumer-price deflation in recent months was mainly driven by falling pork prices, a key component of the CPI basket. While prices are likely to pick up, the slow recovery in household spending means inflation will likely remain subdued
  • The central bank has vowed to avoid any sharp policy turn as it gradually tapers the stimulus it pumped into the economy last year. Growth in producer prices will likely ease from the third quarter, Huang Wentao, an analyst at China Securities Finance Co., said before the data was released

Get More

  • The rapid pace of inflation has gained the attention from top policy makers, with the Financial Stability and Development Committee chaired by Vice Premier Liu He calling for efforts to stabilize prices this week. Authorities should “keep a close eye on commodities prices,” according to a statement released Thursday evening after the committee met.

©2021 Bloomberg L.P.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.