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China inflation
EconomyEconomic Indicators

China’s producer, consumer inflation up in April as Iran war pressures persist

Factory-gate prices increased 2.8 per cent last month and consumer prices were up 1.2 per cent, surpassing expectations as fuel costs rise

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A ship offloads liquid natural gas at the PetroChina Jiangsu LNG terminal at Yangkou port in Rudong, in eastern China’s Jiangsu province. Photo: AFP
He Huifengin Guangdong

A major benchmark of China’s factory-gate prices continued to rise last month, as the energy shock linked to the US-Israel war on Iran weighs on producers in the world’s second-largest economy.

After returning to growth for the first time in more than three years the month before, the producer price index (PPI) recorded a higher-than-expected year-on-year increase of 2.8 per cent in April, according to the National Bureau of Statistics (NBS).

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This followed March’s 0.5 per cent year-on-year increase, which had also reflected imported inflationary pressures in energy-intensive sectors such as chemicals and fuels.

Economists polled by the financial data provider Wind had forecast a 1.53 per cent uptick.

The April reading points to a further pass-through of elevated global energy costs into domestic prices, underscoring the risks that external volatility places on Beijing’s energy security.

The consumer price index (CPI) – a crucial gauge of inflation – rose 1.2 per cent year-on-year last month, higher than the 0.95 per cent forecast in the Wind poll and March’s increase of 1 per cent.

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Dong Lijuan, a senior statistician at the bureau, said domestic energy prices climbed 5.7 per cent, which he attributed to volatility in global crude, which contributed an increase of 0.39 percentage points to the month-on-month CPI rise.

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