Employees work on the production line of a robot vacuum cleaner factory in Shenzhen in August 2019. China’s producer price index soared by 6.8 per cent year on year in April, reaching its highest level since October 2017. Photo: Reuters Employees work on the production line of a robot vacuum cleaner factory in Shenzhen in August 2019. China’s producer price index soared by 6.8 per cent year on year in April, reaching its highest level since October 2017. Photo: Reuters
Employees work on the production line of a robot vacuum cleaner factory in Shenzhen in August 2019. China’s producer price index soared by 6.8 per cent year on year in April, reaching its highest level since October 2017. Photo: Reuters
Yu Yongding
Opinion

Opinion

Yu Yongding

In China at least, a little inflation may not be a bad thing

  • The divergence in the increases in consumer and producer prices is the result of Chinese producers’ preparations for a post-pandemic surge in demand, which has yet to materialise
  • This lack of price pass-through has kept consumer inflation low, but squeezed the profits of downstream producers, which will ultimately undermine economic growth

Employees work on the production line of a robot vacuum cleaner factory in Shenzhen in August 2019. China’s producer price index soared by 6.8 per cent year on year in April, reaching its highest level since October 2017. Photo: Reuters Employees work on the production line of a robot vacuum cleaner factory in Shenzhen in August 2019. China’s producer price index soared by 6.8 per cent year on year in April, reaching its highest level since October 2017. Photo: Reuters
Employees work on the production line of a robot vacuum cleaner factory in Shenzhen in August 2019. China’s producer price index soared by 6.8 per cent year on year in April, reaching its highest level since October 2017. Photo: Reuters
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Yu Yongding

Yu Yongding

Yu Yongding, a former president of the China Society of World Economics and director of the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, served on the Monetary Policy Committee of the People’s Bank of China from 2004 to 2006.