China’s factory gate inflation jumped in August to a 13-year high, with data on Thursday showing a surge in commodity prices as the global emergence from the pandemic sees demand picking up but supplies limited.
The producer price index (PPI), which measures the cost of goods at the factory gate, rose to 9.5% last month from 9.0% in July, the National Bureau of Statistics said.
The reading was above forecasts for 9.0% and is the highest since 2008, when the figure hit 10%.
The surge was “affected by a rise in prices of coal, and chemical and steel products,” NBS senior statistician Dong Lijuan said in a statement.
Industries have seen “strong demand and tight supply overall,” pushing up prices in coal mining, while earlier pick-ups in costs of crude oil and coal have weighed on other production costs.
The rises come despite government measures to ease pressure on factory costs such as cracking down on firms hoarding goods and ramping up supplies.
However, the spike in manufacturing costs is still to filter through to shoppers as Thursday’s data also showed the consumer price index (CPI), a key gauge of retail inflation, dipped to 0.8% from 1% in July and below expectations.
The drop came on the back of cooling food costs, with pork prices sinking 44.9% on-year.
Analysts also said the recent coronavirus resurgence that forced parts of the country into lockdown also likely had an impact.
“Some easing in domestic spending due to movement restrictions is expected to have weighed on household consumption,” said Moody’s Analytics in a note this week.