China’s Factory Inflation Slows to 8.8% in February

Source: National Bureau of Statistics of China

China’s factory inflation in February falls to the lowest annual rate in eight months. CSI 300 Index down -0.92% , CNY USD down -0.01%

• The producer price index (PPI) rose 8.8% on the year, dropping from 9.1% expansion in January, but was higher an estimate of 8.7% from a Reuters poll.
• Many Chinese factories stopped operations in the first half of Feb due to Lunar New Year celebrations, triggering a reprieve on demand for raw materials.
• Meanwhile, Russia’s invasion of Ukraine has increased concerns of global supply chain constraints, pushing commodity prices to new record-highs.
• Monthly PPI posted gains from a decrease in January, with global crude oil prices surging and increasing prices in domestic oil-related sectors.
• An official at the state economic planner stated on Monday that the Chinese government’s efforts to control commodities were facing new challenges due to the ongoing geopolitical crisis.