Rising costs of imported raw materials have brought Chinese factory inflation to its highest level since 2008, increasing the likelihood that exporters will start passing higher prices and increase inflationary pressures in the global economy.
The producer price index rose 9% in May from the previous year, driven by increases in oil, metal and chemical prices, the National Statistics Office said Wednesday.
The median forecast in a Bloomberg survey of economists was an increase of 8.5%.
Consumer inflation rose only 1.3% from a year ago, missing a 1.6% estimate and suggesting that retailers are not yet raising prices due to sluggish domestic demand.
Read more ….
WNU Editor: I talked about it a few weeks ago. Globally speaking, China is the place to look for future trends. Or to put it more bluntly. What happens first in China eventually repeats itself in the rest of the world at a later time.
Case in point. China was the first country to experience the pandemic. The first country to shut down its economy. The first country to close its borders. The first country to open (with restrictions). The first country to experience a booming economy. It is now the first country to have severe inflation. My prediction. The highest inflation is coming to the rest of the world.
More news on China in the face of inflationary pressures
China moves to tame inflation before prices rise too much – New York Times
Chinese inflation could be the world’s problem – Bloomberg