BEIJING • China’s producer price inflation accelerated more than expected to a four-month high in August, fuelled by strong gains in raw material prices and pointing to strong, sustained growth for both factory profits and the economy..
BEIJING • China’s producer price inflation accelerated more than expected to a four-month high in August, fuelled by strong gains in raw material prices and pointing to strong, sustained growth for both factory profits and the economy.
Consumer inflation also quickened more than forecast to a seven-month high, amid signs that upstream price gains are trickling through, but analysts said price gains remain modest and there is little pressure on the central bank to tighten policy further.
“The unexpected rise in both CPI (consumer price index) and PPI (producer price index) suggests there is little hope China’s monetary policy could see some relaxation before the end of this year, ” said Singapore-based analyst Zhou Hao at Commerzbank.
“We believe the market has underestimated the inflationary pressure facing China’s economy, although inflation is unlikely to surge in the foreseeable future. That said, onshore rates are still on the rise, ” he said, referring to higher financing costs.
China’s PPI rose 6.
