Posted on 09 Aug 2023
China's Consumer Price Index (CPI) dropped 0.3% on year in July, posting the first on-year decline since March 2021, though on a monthly basis it increased by 0.2% from June, according to the latest data released by the county's National Bureau of Statistics (NBS) on Wednesday morning. Also last month, the country's Producer Price Index (PPI) slid at a slower pace by 4.4% on year and lost 0.2% on month, the data showed.
The on-year growth rate of China's CPI had been continuously slowing down during the first half of this year before sliding into the negative zone last month, Mysteel Global noted. "The on-year drop in July was mainly due to last year's high base," commented Dong Lijuan, a senior statistician with the NBS.
The weakening of food prices was the major drag on domestic consumer prices, NBS data showed, with the prices of pork and vegetables falling 26% and 1.5% respectively on year.
However, "the on-year retreat in CPI is temporary, and it is expected to rise again in the coming months with domestic economy recovering steadily," Dong noted.
Compared with June, China's CPI ended a five-month drop and picked up 0.2% in July, as the prices in the tourism industry jumped on the passionate travel activities during the summer vacations across the country, according NBS release.
For example, the prices of air ticket and accommodation gained 26% and 6.5% on month respectively in July.
As for China's PPI in July, it remained on a downtrend amid ample industrial supply in the country, but the decline narrowed as the demand improved for some commodities such as coal and steel, Mysteel Global learned.
During last month, the prices in the coal mining and processing industry dropped 2% on month and 19.1% on year, and those in the steelmaking and fabrication sector fell 0.1% and 10.6% respectively, all being narrower from their June readings, NBS data showed.
On the other hand, the increase in the global prices of oil and nonferrous metals lent some support to the relative commodity prices in China, Dong observed. Domestic prices of oil and natural gas drilling industry and nonferrous manufacturing and processing industry increased 4.2% and 0.4% respectively on month in July, according to NBS data.
Over January-July overall, China's CPI registered an on-year rise of 0.5%, while the PPI dropped 3.2% on year, according to NBS statistics.
Source:Mysteel Global
