China’s exports to U.S. fall amid trade war

Marco Green
September 10, 2019

Fresh vegetable prices, however, retreated 0.8 percent; the first decline after rising for 18 consecutive months.

China's consumer prices climbed at a steady pace in August, while producer prices declined further on weak demand signaling deflationary pressures.

The average pork price increased 46.7% year-on-year amid fallout from the country's ongoing African swine fever outbreak, contributing 1.08 percentage points to CPI growth.

The food price index rose 10% on-year, from a 9.1% jump in July and the highest since January 2012.

China's producer price index (PPI) dropped 0.8 per cent from a year earlier in August, widening from a 0.3 per cent decline seen in July and the worst year-on-year contraction since August 2016, National Bureau of Statistics (NBS) data showed on Tuesday (Sept 10). "But the upcoming RRR (reserve requirement ratio) cuts announced Friday are in line with our view that rampant food price inflation is not a barrier to monetary easing".

Prices in the education, culture and entertainment sector, health care and housing rose by 2.1 percent, 2.3 percent and 1 percent, respectively.

The CPI increased 0.7% in August from July. The year-on-year data were released as a long-running trade spat between the two world powers showed no sign of ending, despite face-to-face negotiations in Shanghai in July.

Overall meat prices, including pork, beef and mutton surged almost 31% in August, compared with July's 18.2% increase, as more consumers shifted to other meat items for protein. But he said at the time that price changes in China remained moderate.

The Producer Price Index, which measures the cost of goods at the factory gate, fell 0.8 percent year on year in August, compared with a 0.3 percent drop in July, and "the negative trend will likely extend before the year end" according to the ANZ Group.

NBS senior statistician Shen Yun said the carryover effect of a year ago resulted in a drop of 0.2 percentage points in the PPI decline in August, while new factors dragged down the index by 0.6 percentage points. The oil, coal and other fuel processing industries also saw price deflation worsening to 5.9 per cent in August.

"With demand-side pressures on prices increasingly subdued, we think that further monetary easing is on the horizon".

Other reports by Click Lancashire

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