Latest news with #ProducerPriceIndex
Jordan News
3 hours ago
- Business
- Jordan News
China's Inflation Rises for the First Time in 5 Months - Jordan News
Consumer prices (inflation) in China rose for the first time in five months in June, while producer prices continued to decline, reflecting the country's ongoing struggle with global trade tensions and weak domestic demand. اضافة اعلان According to data released by the National Bureau of Statistics on Wednesday: The Consumer Price Index (CPI) rose by 0.1% year-on-year in June, compared to a 0.1% decline in May, exceeding Reuters analysts' expectations of no change. On a monthly basis, the CPI fell by 0.1%, compared to a 0.2% drop in May, in line with economists' forecasts. Meanwhile, the Producer Price Index (PPI), which measures factory-gate prices, fell by 3.6% year-on-year in June, deeper than the 3.3% decline recorded in May and marking the sharpest drop since July 2023. Reuters had forecast a 3.2% drop. Export-Driven Sectors Face Growing Pressure China's export-reliant industries are under mounting pressure from global trade headwinds. Manufacturing prices in sectors such as computers, telecommunications, and electronics saw accelerated declines last month, signaling weak global demand. Uncertainty stemming from U.S. President Donald Trump's tariff policies has further clouded the outlook for export-reliant firms, especially given persistent weak domestic consumption. Dong Liguang, chief statistician at the National Bureau of Statistics, said the drop in producer prices was partly due to severe weather impacting construction activity, putting pressure on raw material prices, according to Bloomberg News. Coal Demand Drops Amid Renewable Energy Expansion Factory-gate prices in coal mining and washing plunged 22% year-on-year, the sharpest decline since 2007. The decline is attributed to China's rapid expansion of renewable energy, reducing coal demand. On the consumer side, prices saw a modest uptick, supported by recovering oil and industrial commodity prices. The annual deflation rate in consumer prices eased from -1.0% to -0.5%. Gold, Textiles, and Electronics See Gains Gold and platinum jewelry prices rose 39% and 16%, respectively. Home textiles and electrical appliances also saw notable price increases. The decline in automobile prices slowed compared to previous months. The electronics and auto sectors likely benefited from a major government purchase subsidy program, though it was temporarily halted in some provinces last month due to funding shortages. Authorities have since pledged to inject additional funds to revive the program. Consumer Confidence Still Weak However, economists warn that Beijing must take more sustainable steps to restore consumer confidence. A new Bloomberg Economics consumer sentiment index showed that despite increased policy support since late 2024, overall public sentiment has remained subdued due to limited improvements in job prospects and income growth. Deflationary pressures have also worsened due to overcapacity in several sectors. Despite promises to cut production, analysts caution that "price wars" could persist for years as local governments try to avoid mass layoffs and their social consequences.
Gulf Today
18 hours ago
- Business
- Gulf Today
China's consumer inflation up 0.1 per cent YoY in June
China's consumer price index (CPI), a main gauge of inflation, was up 0.1 per cent year-on-year (YoY) in June, data from the National Bureau of Statistics (NBS) showed on Wednesday. The CPI in urban regions rose 0.1 per cent year-on-year last month, while that in the rural regions was down 0.2 per cent, according to the data. On a monthly basis, the CPI dipped 0.1 per cent in June, China Daily quoted the data as showing. In the first half of 2025, the country's CPI posted a 0.1-percent decline compared with the same period last year, according to the bureau. The official data also indicated that the producer price index (PPI), which measures costs for goods at the factory gate, went down 3.6 per cent year-on-year in June. On a month-on-month basis, the PPI dropped 0.4 per cent in June, according to the data. In the first half of 2025, the PPI dropped by 2.8 per cent year-on-year, the data showed. China to host 200 digital economy, AI training programmes for Global South China's consumer prices fell at a slower pace in March, while the annual decline in factory-gate prices deepened, official data showed on Thursday. The country's Consumer Price Index (CPI), the main gauge of inflation, fell by 0.1 per cent year-on-year in March after a 0.7 per cent drop in February, according to the National Bureau of Statistics (NBS). China Daily reported that within the CPI, food prices experienced a year-on-year decline of 1.4 per cent, compared to a decrease of 3.3 per cent in February. Month-on-month, the CPI dipped 0.4 per cent in March, following a 0.2 per cent drop in February. The growth in core CPI, which excludes volatile food and energy prices and is deemed a better gauge of the supply-demand relationship in the economy, rose by 0.5 per cent year-on-year in March after a 0.1 per cent dip in February. Dong Lijuan, an NBS statistician, attributed the month-on-month CPI decline to the abundant food supply due to warmer weather, lower prices of travel-related services in the off-season and declining international oil prices. Dong also highlighted the emergence of some positive signs, such as the narrowing decline in year-on-year CPI and the growth in core CPI, saying policies aimed at boosting consumer demand started to take effect and the impact of the timing difference of the Spring Festival holiday gradually faded. China's Producer Price Index (PPI), which gauges factory-gate prices, dropped by 2.5 per cent year-on-year in March, widening from a 2.2 per cent fall in February, the NBS said. On a month-on-month basis, the PPI dropped 0.4 per cent in March after a 0.1 per cent decrease in February, according to the NBS. Dong said the factory-gate prices declined due to lower prices for domestic petroleum products and certain export-oriented industries, seasonal weakening demand for energy products such as coal, and the declining prices in several raw materials. Meanwhile China will launch the 'Digital South' initiative under the framework of the Global Development Initiative (GDI), offering 200 training programmes in artificial intelligence (AI) and the digital economy to Global South countries over the next five years, Premier Li Qiang announced during the 17th BRICS Summit. Speaking during plenary sessions held on Sunday and Monday in Rio de Janeiro, Premier Li highlighted key topics including strengthening multilateralism, AI, environmental and climate change, and global health, Xinhua News Agency said. Leaders of BRICS member states, partner countries, guest nations, and representatives of international organisations attended the meetings. The current international economic and trade order, as well as the multilateral trading system, are under severe strain, and the global economic recovery remains challenging, Li said. He noted that the Greater BRICS cooperation should uphold its founding purpose, meet the needs of the times, safeguard and practice multilateralism, promote the establishment of a fair and open international economic and trade order, and unite the strength of the Global South to make greater contributions to global stability and development. He emphasised the need to open up new blue oceans for economic growth by expanding cooperation in emerging areas such as the digital and green economies, leveraging AI to empower a wide range of industries and benefit countless households, and helping Global South countries enhance their capabilities. As part of this commitment, China will host 200 training programmes in the digital economy and AI for Global South countries over the next five years. Premier Li also invited global participation in the upcoming World Artificial Intelligence Conference, scheduled to take place in China this July. Ursula von der Leyen, President of the European Commission, has announced that the European Union aims to rebalance its economic relationship with China by demanding fair and reciprocal access for European companies to the Chinese market. Agencies
Fibre2Fashion
a day ago
- Business
- Fibre2Fashion
China's inflation stays flat in June, producer prices slide further
China's Consumer Price Index (CPI), a key measure of inflation, rose marginally by 0.1 per cent year-over-year (YoY) in June 2025, according to data released by the National Bureau of Statistics (NBS). Urban areas saw a 0.1 per cent increase, while rural regions recorded a 0.2 per cent decline. Meanwhile, on a month-over-month (MoM) basis, the CPI edged down 0.1 per cent and in the first half of 2025, the CPI registered a slight 0.1 per cent decline YoY. In contrast, the Producer Price Index (PPI), which tracks prices at the factory gate, dropped 3.6 per cent in June from a year earlier, with a 0.4 per cent fall monthly. Over the January–June period, the PPI decreased by 2.8 per cent YoY. China's CPI rose 0.1 per cent year-over-year in June 2025, with urban prices up slightly and rural prices down 0.2 per cent, as per NBS data. MoM, CPI dipped 0.1 per cent, while H1 saw a 0.1 per cent decline. The country's PPI fell 3.6 per cent annually in June and 2.8 per cent in H1, driven by lower raw material costs, renewable energy output, and export-sector price pressures. The decline in the PPI can be attributed to seasonal drops in prices across certain domestic raw material manufacturing industries, lower energy prices driven by increased solar, wind and hydropower generation, and price pressures faced by some export-led sectors, NBS statistician Dong Lijuan was quoted as saying by Chinese media reports. Fibre2Fashion News Desk (SG)
Business Times
02-07-2025
- Business
- Business Times
The surprising tariff lesson buried in inflation data
IF THE Trump administration's tariff policies result in higher overall inflation – a scenario that will play out in the coming weeks – the question is who will pay for it. A surge in prices will presumably raise the cost of doing business. Less clear is whether, and to what extent, companies will pass on those higher costs to consumers. Any inflationary impact from tariffs should first show up in the Producer Price Index (PPI), which reflects changes in the cost of producing goods and services sold to consumers. Over time, producer inflation is passed on to consumers and shows up in the better-known Consumer Price Index (CPI). The PPI and CPI's long history shows that the two are closely related. They have grown at roughly similar rates – the PPI by 2.8 per cent a year since 1913 through May, and the CPI, at a slightly higher rate of 3.2 per cent a year. Annual changes in the two indexes have also been highly correlated over that time (0.8, counting monthly). The relationship was as strong during the past 30 years (0.81), marked by the increasing globalisation of trade, as it was during the first three decades of the data series (0.79). That long and consistent history supports the intuition that in the long run, businesses do – indeed, must – pass on their higher costs to consumers. Looking at shorter periods, however, the numbers tell a more nuanced story. The first thing that jumps out is that annual changes in the PPI have been twice as volatile as those of the CPI, as measured by annualised standard deviation. This suggests that businesses have routinely shielded consumers from much of the turbulence in producer inflation. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Notably, most of that shielding occurred when producer inflation spiked. The median annual change in PPI has been 2.3 per cent since 1913. During 12-month periods when producer inflation was lower than the median, roughly half the time, CPI outpaced PPI more than 90 per cent of the time, and by a median of 2.2 percentage points. But when annual producer inflation was higher than 2.3 per cent, it was just the opposite. On those occasions, PPI outstripped CPI more than 70 per cent of the time and by a median of 1.6 percentage points. The results are nearly identical when annual changes in PPI and CPI are compared on a six- or 12-month lag. In other words, the higher the inflation, the more likely businesses were to absorb most of the higher cost, at least in the near term, and vice versa. One way to understand that divergence is that there may be a limit to how much price inflation consumers can digest at one time. It would explain why businesses seem to have little trouble passing on their own higher costs to consumers in normal inflation environments, but struggle to do so when inflation spikes. Companies may also have a strategic incentive to internalise cost surges, given competing considerations of volume and margin. Raising prices would protect profit margins in the near term, but could imperil them down the road if higher prices result in lower volume and market share. Passing on higher costs to consumers gradually might be a way to protect both, particularly if companies have margin to spare. Fortunately, many big US companies do – the profit margin for the S&P 500 Equal Weight Index is near an all-time high, and expected to grow this year and next. That may explain why the stock market has been so sensitive to tariff news this year. The White House's Liberation Day announcement was greeted with one of the worst two-day US stock market routs on record, and the tariff delays were routinely celebrated with surging stock prices. The seemingly single-minded focus on levies makes sense if companies have the most to lose. One countervailing consideration is that heightened inflation expectations may give companies more room than usual to raise prices. A notable outlier in the data is that during the hyperinflationary years of the late 1970s and early 1980s, CPI mostly kept pace with PPI despite double-digit producer inflation. Businesses may have been able to raise prices more aggressively because consumers had come to expect big price hikes. Memories of the pandemic's price surge are a big reason Federal Reserve Chair Jerome Powell has called for caution on cutting interest rates until the implications of tariffs are more clear. With inflation expectations for next year nearly double the long-term inflation rate, businesses may be able to push costs to consumers more quickly. The PPI and CPI do not overlap perfectly, so they can only be a rough guide to the way businesses and consumers navigate higher prices. But given the behaviour of producer and consumer inflation during previous periods of surging prices, do not be surprised if any tariff-related inflation is initially absorbed mostly by companies. BLOOMBERG
Deccan Herald
02-07-2025
- Business
- Deccan Herald
The surprising tariff lesson buried in inflation data
Any inflationary impact from tariffs should first show up in the Producer Price Index, which reflects changes in the cost of producing goods and services sold to consumers. Over time, producer inflation is passed on to consumers and shows up in the better-known Consumer Price Index.
