China fac­tory gate in­fla­tion misses ex­pec­ta­tions in July

Kuwait Times - - BUSINESS -

China’s fac­tory price in­fla­tion re­mained steady for the third con­sec­u­tive month in July, the gov­ern­ment said yes­ter­day, com­ing in slightly be­low ex­pec­ta­tions as ex­perts warn of a fur­ther slow­down in the world’s sec­ond-largest econ­omy. The pro­ducer price in­dex (PPI) rose 5.5 per­cent yearon-year, ac­cord­ing to the Na­tional Bureau of Sta­tis­tics (NBS), the same as the pre­vi­ous two months but miss­ing the 5.6 per­cent gain fore­cast in a Bloomberg News sur­vey.

Ju­lian Evans-Pritchard of Cap­i­tal Eco­nom­ics warned the pro­ducer price gauge’s steadi­ness “ap­peared to be al­most en­tirely due to the re­cent rally in do­mes­tic steel prices, which is un­likely to be sus­tained in our view”. China’s steel prices surged in July, which has helped lead world steel mar­ket prices higher, the China Iron and Steel In­dus­try As­so­ci­a­tion has said. China’s con­sumer price in­dex (CPI), a main gauge of re­tail in­fla­tion, rose 1.4 per­cent year-on-year last month, down from 1.5 per­cent in June and also miss­ing Bloomberg’s fore­cast of 1.5 per­cent.

Con­sumer price in­fla­tion has been “gen­er­ally sta­ble”, NBS an­a­lyst Sheng Guo­qing said in a state­ment, adding that high tem­per­a­tures and heavy rains this sum­mer have sup­ported veg­etable and egg prices.

“With pol­icy tight­en­ing now weigh­ing on eco­nomic ac­tiv­ity, un­der­ly­ing in­fla­tion has al­ready be­gun to de­cline,” Evan­sPritchard said in a re­search note.

The in­fla­tion data came a day af­ter the re­lease of fig­ures show­ing the rate of growth in China’s ex­ports and im­ports also slowed sig­nif­i­cantly in July. — AFP

BEI­JING: Peo­ple ride an es­ca­la­tor at an up­scale shop­ping mall in Bei­jing on Tues­day. China’s trade growth weak­ened in July in a neg­a­tive sign for growth in the world’s sec­ond-largest econ­omy and global de­mand. —AP

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