Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

China’s May Factory Gate Prices Jump at Fastest Pace Since 2008

Economic IndicatorsJun 09, 2021 14:57
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Gina Lee

Investing.com – China’s factory-gate prices jumped in May to their highest level since 2008 driven by surging commodity prices. Consumer prices also increased for the third consecutive month but at a lower-than-expected pace.

The producer price index (PPI) increased 9.0% year-on-year in May, higher than 8.5% in forecasts prepared by Investing.com the highest rate of growth since 2008. The rise was also higher than the 6.8% growth during the previous month, according to data released by the National Bureau of Statistics (NBS).

The jump in PPI was driven by price surges in crude oil, iron ore and non-ferrous metals, said the NBS in a statement. Commodity prices, including coal, steel, iron ore and copper, surged in 2021 driven by demand recovery in post-lockdown areas and ample global liquidity.

China’s PPI is likely to climb through the second and third quarters due to higher commodity prices and low bases in 2020 before moderating later in 2021, said People’s Bank of China.

China’s policymakers have pledged to take measures to curb soaring commodity prices, including increasing supplies of raw materials and cracking down on speculation and hoarding.

However, soaring producer prices have yet to pass through to consumer prices.

The consumer price index (CPI) increased 1.3% year-on-year in May, below a 1.6% increase in forecasts prepared by Investing.com but higher than 0.9% gains during the previous month. The CPI also contracted 0.2% month-on-month in May, higher than forecasts prepared by Investing.com.

Higher metal prices have mainly impacted upstream industries involved in the mining and processing of raw materials, and have had minimal influence on downstream industries like furniture and textiles, said Bloomberg Economics in an analysis.

Meanwhile, competition among smaller businesses intensified due to the rise of ecommerce and decrease in domestic demand, indicating that China’s factories are absorbing rising input costs rather than passing them on to consumers.

China’s May Factory Gate Prices Jump at Fastest Pace Since 2008
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email