China’s PPI Data Points to Economic Recovery
Factory gate prices across Chinese companies declined for the seventh consecutive month during August, but at the slowest pace since March
Factory gate prices across Chinese companies declined for the seventh consecutive month during August, but at the slowest pace since March, reinforcing hopes of economic recovery. Data released by the NBS reveals that PPI fell by 2% YoY in August, a smaller decline than the 2.4% fall seen in the previous month.
Meanwhile, China’s CPI increased by 2.4% YoY, growing at a slower pace than the 2.7% rise seen in July. Both readings were in line with economists’ forecasts.
Senior statistician at NBS, Dong Lijuan, notes, “In August, industrial production continued to improve while market demand kept recovering. Prices for global commodities such as crude oil, iron ore and non-ferrous metals continued to rise, driving a rebound in domestic factory gate prices.”
After bringing the coronavirus outbreak under control, China’s economy returned to growth during Q2 2020. Recent economic data releases also point to a rebound in economic activity and domestic consumption across the country; however, the trade reliant economy faces risks due to a weakness in external demand as most parts of the world are still registering an increase in the number of cases.
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