The fall in producer prices in China continued in February

In February, consumer prices in China rose below expectations, while the downward trend in producer prices continued.

China’s National Bureau of Statistics (UIB) announced February 2023 data on price increases in the country.

Consequently, while the Consumer Price Index (CPI) in China increased 1 percent in February compared to the same month a year earlier, the Producer Price Index (PPI) decreased 1.4 percent.

PPI DECREASES OVER 3 MONTHS

Thus, the fall in the PPI continued, which is calculated based on the ex-factory prices of manufacturing products, registered in October, November and December 2022 and in January of this year.

The contraction of the manufacturing sector in the last months of the year and the loss of activity due to the Covid-19 restrictions were effective in lowering producer prices. Although the restrictions were lifted in December 2022, it is seen that the manufacturing sector has not yet reached the recovery momentum.

On the other hand, the CPI, which is considered the main indicator of inflation, decreased 0.5 percent monthly in February, below expectations of a 0.2 percent increase.

The Senior Statistician of the UIB, Dong Licüen, evaluated that after the increase in consumption during the Spring Festival in January, the drop in demand in the market at the end of the holiday period was effective in weakening inflation.

Food prices rose 2.6 percent in February, while non-food inflation was 0.6 percent.

Premier Li Kiqiang stated in the government’s annual work report submitted to the National People’s Congress on March 5 that he aims to keep inflation around 3 percent this year. (AA)