China factory gate inflation snaps five month drop in April

BEIJING: Chinese factory gate prices rose in April to snap five months of falling, data showed yesterday, but analysts said the downtrend would likely continue as government antipollution measures are lifted.

Inf lation hit a nine- year high in 2017 on restrictions of heavy industry production by authorities to curb air pollution during the winter months, as well as state efforts to slash excess industrial capacity.

But the producer price index – a key barometer of the industrial sector – has been easing since the end of last year as those controls are tempered.

Official data Thursday showed the PPI hit 3.4 per cent in April, up from 3.1 per cent in March, in line with a forecast by economists surveyed by Bloomberg News.

However, Jul ian EvansPritchard of Capital Economics wrote in a research note that the lifting of anti- pollution measures – which had crimped supplies of various products – was still weighing on prices of industrial goods.

The consumer price index – the key gauge of retail inf lation – eased to 1.8 per cent from 2.1 per cent in March, and slightly short of the 1.9 per cent forecast and well off the government target of “around three per cent”.

Pork prices dropped 16.1 per cent year- on- year, dragging down the consumer price inf lation, Sheng said. — AFP