Special Report: Global Financial Crisis
BEIJING, Dec. 10 (Xinhua) -- China's producer price index (PPI),a measure of inflation at the factory level, decelerated sharply to an annual rise of 2 percent in November, the National Bureau of Statistics (NBS) announced on Wednesday, prompting worries about the fast-slowing economy and rising deflation risks.
It was the slowest pace for the PPI since May 2006, the NBS said.
The PPI rose 6.6 percent in October, the third month in a row in which wholesale-level price inflation slowed. The PPI peaked at 10.1 percent in August, when China was experiencing mounting inflation pressure.
"The rapidly falling PPI is a sign that the economy has been slowing fast," the U.S.-based bank Merrill Lynch said in a report.
The slowdown was mainly caused by mining and raw materials. Producer prices for the mining sector rose 6.6 percent year-on-year in November, dramatically down from 22.7 percent in October. Those for raw materials rose 0.4 percent, down from 9 percent in October.
Wholesale prices of consumer goods fluctuated less dramatically, rising 2.1 percent year-on-year last month, down from 3.1 percent in October. The NBS is expected to release the consumer price index (CPI) figure for November on Thursday.
"The larger-than-expected November PPI figure was mainly a result of falling commodity prices, especially global crude prices," said Haitong Securities analyst Liu Tiejun.
Merrill Lynch said the latest PPI figure was below its earlier forecast of 3.8 percent and the 4.5-percent median forecast of economists surveyed by Bloomberg.
Merrill Lynch forecast that both the PPI and CPI would show declines in the coming months, which would give the government "more room" to conduct an active monetary policy and step up stimulus spending.
The PPI figure was the latest in a series of reports indicating a sharp economic turnaround within just a few months.
China's gross domestic product expanded at an annual rate of 9 percent in the third quarter, down from 10.1 percent in the second quarter and 10.6 percent in the first quarter.
The People's Bank of China, or the central bank, cut borrowing costs three times within six weeks through the end of October.
Merrill Lynch said it expected no more rate cuts until next year, when it said the central bank would also lower banks' reserve requirement ratio.
The PPI from January to November rose 7.6 percent from a year earlier, compared with 8.2 percent in the 10 months through October, according to the NBS.
China PPI falls to 6.6 % in
October
BEIJING, Nov. 10 (Xinhua) -- China's producer price index
(PPI), rose at a slower annual rate of 6.6 percent in October, the National
Bureau of Statistics (NBS) announced on Monday.
The rise in factory gate prices was down from 9.1
percent in September and the 12-year high of 10.1 percent in August. Full story
China CPI eases to 4% in
October
BEIJING, Nov. 11 (Xinhua) -- China's consumer inflation
rose at a slower annual rate of 4 percent in October, giving the government more
room to ease macroeconomic controls to stimulate the economy.
Rises in consumer price index (CPI), the main gauge
of inflation, slowed for the six straight months. The figure, compared with 4.6
percent in September, 4.9 percent in August, 6.3percent in July, 7.1 percent in
June, and a nearly 12-year-high of8.7 percent in February, was broadly in line
with most forecasts. Full story
China's 4 trillion yuan stimulus to
boost economy, domestic demand
BEIJING, Nov. 9 (Xinhua) -- China said on Sunday it will
loosen credit conditions, cut taxes and embark on a massive infrastructure
spending program in a wide-ranging effort to offset adverse global economic
conditions by boosting domestic demand.
This is a shift long advocated by analysts of the Chinese
economy and by some within the government. It comes amid indications that
economic growth, exports and various industries are slowing. Full story
China adopts "active" fiscal,
"moderately easy" monetary policies to boost
economy
BEIJING, Nov. 9
(Xinhua) -- China has decided to adopt active fiscal policy and moderately easy
monetary policies to boost fast but steady economic growth by expanding domestic
demand, according to an executive meeting of the State Council on Sunday.
It is estimated that investment into infrastructure,
social welfare and other key sectors will amount to four trillion yuan by the
end of 2010. Full story
China tries to revive economy despite
daunting challenges
BEIJING, Nov.
9 (Xinhua) -- Although China doesn't celebrate Christmas, Lou Qijun is one of
the many Chinese toy and gift manufacturers who anticipates a visit from Santa
Claus every year in the form of seasonal orders from the Europe and North
America.
Not so this year, says Lou, chairman of Yiwu Qiling Toys
Co. Ltd., a leading toy producer in east China's Yiwu City, Zhejiang Province, after returning from the
Canton Fair, the country's biggest trade show which concluded on
Thursday. Full story
