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Thursday, September 28, 2023

China’s CPI Dips to an 18-Month Low in March

BusinessChina's CPI Dips to an 18-Month Low in March

China’s consumer inflation eased in March, reaching an 18-month low, while factory-gate prices showed an annual fall for the sixth consecutive month, according to official data released on Tuesday by the National Bureau of Statistics. The consumer price index (CPI), a primary measure of inflation, rose by 0.7 percent from a year ago in March, down from 1 percent in February. Food prices rose by 2.4 percent in March compared to a year ago, with pork prices surging by 9.6 percent, up from a rise of 3.9 percent in February. Prices for fresh fruits and poultry increased by 11.5 percent and 7.4 percent, respectively, while egg prices rose by 7.8 percent. Fresh vegetable prices dropped by 11.1 percent. On a month-on-month basis, the CPI decreased by 0.3 percent after declining 0.5 percent in February.

The growth in core CPI, which excludes volatile food and energy prices and is considered a better gauge of the supply-demand relationship in the economy, rose by 0.7 percent year-on-year in March, up from a rise of 0.6 percent in February.

According to Dong Lijuan, a statistician at the NBS, consumer inflation decreased in March due to the continued resumption of production and life, as well as sufficient market supplies. Meanwhile, the decline in factory-gate prices was affected by a high comparison base in the previous year.

The producer price index (PPI), which measures factory-gate prices, fell 2.5 percent from a year ago in March, compared to a 1.4 percent annual contraction in February. On a month-on-month basis, there was no growth or decline in factory-gate prices registered in March.

The easing of inflation and the fall in factory-gate prices in China could have implications for global economic growth and could potentially increase deflationary pressures in other economies, particularly in Asia. However, the situation is still within manageable limits, and the government is expected to continue its economic policies to ensure a stable recovery.

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