Saturday 25 January 2020 ,
Saturday 25 January 2020 ,
Latest News
  • Properly follow Bangabandhu’s ideology to build Sonar Bangla: PM
  • BNP has no history of victory: Obaidul Quader
  • German shooting: 6 dead in Rot am See attack
  • Tigers lose first T20I by 5 wickets against Pakistan
  • Myanmar must do more to protect Rohingyas: UK
  • UN welcomes ICJ order
  • New AL committee pays tributes to Bangabandhu at Tungipara
  • Mirpur slum fire doused
  • Vaccine for novel coronavirus may be ready in 3 months: U.S. scientists
  • China shuts down 13 cities as virus toll climbs to 26
10 September, 2019 11:46:30 AM
Print

China's factory prices fall faster as weak demand hits economy

Independent Online/ AFP
China's factory prices fall faster as weak demand hits economy
The People's Bank of China on Friday said it would cut the amount of cash lenders must keep in reserve saying it would help release more than $100 billion into the stuttering economy. Photo: AFP

The prices Chinese firms pay factories for their goods fell last month at the fastest pace in three years, official data showed Tuesday, as slackening demand and the bruising US trade war drag on the economy.

Consumer prices were also broadly subdued and only supported by a surge of almost 50 percent in the price of pork caused by African swine fever that has ravaged the country's pig industry.

The producer price index (PPI) -- an important barometer of the industrial sector that measures the cost of goods at the factory gate -- dropped 0.8 percent on-year in August, following a 0.3 percent drop in July.

A slowdown in factory gate inflation reflects sluggish demand, while a turn to deflation could dent corporate profits and drag on the world's number two economy, which in turn could lead to a drop in prices globally.

While the figure from the National Bureau of Statistics (NBS) marked the second consecutive month of decline, it was slightly better than the 0.9 percent fall forecast in a Bloomberg News survey.

Last month was the first time the PPI had fallen into negative territory since August 2016.

Petroleum and natural gas mining, and coal and other fuel-processing sectors led the drop, NBS official Shen Yun said in a statement, indicating weakness in manufacturing.

However, consumer price index (CPI) -- a gauge of retail inflation -- rose 2.8 percent last month, stabilising from July and beating forecasts.

But while meat and egg prices rose as traditional Chinese mid-autumn festival approaches, pork was the key driver, shooting up 46.7 percent on-year owing to a shortage in supply of the staple, Shen said.

The country's pig industry has taken a heavy hit from a mass outbreak of African swine fever that has seen huge amounts of the animals culled in recent months, causing China to begin relying on imports.

Julian Evans-Pritchard of Capital Economics said that further easing measures are likely as pressure in demand and factory-gate deflation deepens.

"Weakening demand dragged producer price inflation further into negative territory last month while surging pork prices kept consumer price inflation elevated," he said in a note.

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

The People's Bank of China on Friday said it would cut the amount of cash lenders must keep in reserve saying it would help release more than $100 billion into the stuttering economy.

China also confirmed last week a new round of trade talks will be held in Washington in early October, in an attempt to patch up the trade tensions between the world's two biggest economies.

BK

Comments

Video
More Business Stories
VW in Canada ordered to pay $150m over emissions scandal A court in Toronto on Wednesday ordered Volkswagen to pay a fine of Can$196.5 million (US $150 million) after the automaker pleaded guilty to violating environmental laws in the emissions cheating scandal. The court accepted an agreement…

Copyright © All right reserved.

Editor : M. Shamsur Rahman

Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Disclaimer & Privacy Policy
....................................................
About Us
....................................................
Contact Us
....................................................
Advertisement
....................................................
Subscription

Powered by : Frog Hosting