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          BIZCHINA> Top Biz News
          China's PPI down 7.2% in May
          (Xinhua)
          Updated: 2009-06-10 13:28

          China's producer price index (PPI), a major measure of inflation at the wholesale level, in May fell 7.2 percent year on year, the National Bureau of Statistics (NBS) announced Wednesday.

          The decline compared with a 6.6-percent drop in April and a 4.6-percent fall in the first quarter from the same period last year.

          Producer prices of production materials fell 8.8 percent in May and those of consumption goods were down 1.9 percent, the NBS said in a statement.

          Special Coverage:
          China Biz & Economic Statistics
          Related readings:
          China's PPI down 7.2% in May CPI falls 1.5%, PPI drops 6.6% in April
           CBRC chief: PPI drop increases deflation risk
           PPI falls to 2-year low in China
           BoCom expects negative CPI growth in H1
          The PPI for January-May fell 5.5 percent over the same period last year.

          A statement on the NBS website attributed the larger-than-expected PPI fall to three factors.

          First, the global economic downturn continued to weigh on the country's economy. Despite price rebounds in major industrial products during the past two months, prices are still lower than the same period of last year.

          Second, prices maintained fast growth in the first eight months of 2008. For instance, the month-on-month PPI growth stood at 0.8 percent in May last year, compared with just 0.1 percent last month. That contributed to a larger fall in the year-on-year figure.

          Third, despite the fact that the PPI has risen month on month for two consecutive months since rising 0.2 percent in April from March, a rebound in the year-on-year figure cannot be seen in the near future as domestic supply will remain excessive in the short term.

          Zhuang Jian, a senior economist with the Asian Development Bank, said the market was experiencing adjustments in inventory and a trend was difficult to discern.

          The NBS also announced the consumer price index for May was down 1.4 percent year on year.


          (For more biz stories, please visit Industries)

           

           

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