Chinese Producer Price Index Drops 2 Percent in April

China’s producer price index (PPI) contracted 2 percent year on year in April, following a 2.3-percent decline in March, pointing to weakness of the economy, National Bureau of Statistics (NBS) data showed on Friday.

The index, which measures inflation at wholesale level, edged down 0.2 percent in April from the previous month, said the bureau.

Among the 30 main industries surveyed, 14 sectors including power generation and oil refining posted month-on-month price increases in April. Sixteen sectors including non-ferrous metal smelting and coal exploitation posted month-on-month price drops, said Yu Qiumei, a senior statistician with the NBS.

The Consumer Price Index (CPI), a main gauge of inflation at retail level, increased 1.8 percent year on year in April, down from 2.4 percent in the previous month, said the bureau.

The two inflation readings reflect the weakness of demand including in both consumption and investment, said Lu Ting, chief China economist with Bank of America Merrill Lynch, in a research note.

via China Daily

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza