China consumer prices drop for first-time in over ten years
09 December, 2020
China's consumer rates dropped a lot more than expected found in November on falling foodstuff costs, with a key gauge turning negative for the very first time in 11 years due to pork rates, according to official info released on Wednesday (Dec 9).
The buyer price index (CPI), an integral gauge of retail inflation, fell 0.5 per cent on-year due to a higher base of comparison in the same period this past year, explained Beijing's National Bureau of Statistics.
This continued a recently available slide influenced by easing prices of pork - a staple meat in the world's second-greatest economy whose prices rocketed after an African swine fever outbreak ravaged stocks.
Pork prices dropped 12.5 per cent, widening October's fall and dragging the headline figure down, while other foods such as eggs, chicken and duck also observed a slide in prices weighed against last year.
But main CPI, which strips away food and energy rates, "continued to stay stable", rising 0.5 per cent from this past year, official data showed.
Capital Economics' senior China economist Julian Evans-Pritchard said November's headline figure was "almost completely driven by improvements on pork supply and isn't evidence of faltering demand".
"To the contrary, broader cost pressures are needs to pick up in the back of the improvement in economical activity," he added.
There is improvement in factory-gate prices, however, with the producer price index (PPI) falling 1.5 % on-year go on month - a smaller drop compared to the 1.8 per cent fall a good Bloomberg poll of analysts expected.
NBS senior statistician Dong Lijuan said "industry demand continued to get, and industrial product rates continued to go up" in November.
PPI measures the price tag on goods at the factory gate, and rates have already been dragged by the coronavirus fallout.
OCBC Bank's brain of Greater China research Tommy Xie told AFP: "The enhancing PPI definitely reinforces the expectation that the Chinese (economic) restoration is on the right track."
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