Beijing, September 9, 2024 – The National Bureau of Statistics of China has reported that in August 2024, the Consumer Price Index (CPI) continued to rise on a monthly basis, while the Producer Price Index (PPI) saw both monthly and year-on-year declines.
Overview of CPI and PPI Indices
In August, the national CPI rose by 0.6% year-on-year. The urban area saw a 0.6% increase, while the rural area experienced a 0.8% rise. Food prices increased by 2.8%, while non-food prices rose by 0.2%. The CPI for consumer goods increased by 0.7%, and that for services rose by 0.5%. Over the period from January to August, the average national CPI increased by 0.2% year-on-year.
On the other hand, the national PPI decreased by 1.8% year-on-year in August, with a monthly decline of 0.7%. The price of industrial goods purchased by producers also decreased by 0.8% year-on-year and 0.6% month-on-month. For the period from January to August, the PPI of industrial goods producers decreased by 1.9% year-on-year, while the price of goods purchased by industrial producers decreased by 2.1%.
CPI: Continued Rise Amid Seasonal Factors
The Chief Statistician of the National Bureau of Statistics, Dong Lijuan, explained the trends in the CPI and PPI indices:
CPI Rise: The monthly CPI increased by 0.4% in August, a decrease of 0.1 percentage points from the previous month. Food prices, which rose by 3.4%, contributed significantly to the monthly CPI increase, affecting it by approximately 0.60 percentage points. The prices of fresh vegetables, fruits, eggs, and pork also rose significantly, contributing to the overall increase in food prices.
Non-Food Prices: Non-food prices, however, decreased by 0.3% month-on-month, partially offsetting the rise in food prices. The decline in domestic gasoline prices and the seasonal decline in airfare and tourism prices were among the factors contributing to the decrease in non-food prices.
Year-on-Year Rise: The year-on-year CPI increased by 0.6% in August, a 0.1 percentage point increase from the previous month. The rise in food prices, particularly vegetables and fruits, and the increase in pork prices were the main contributors to the year-on-year CPI increase.
PPI Decline Due to Market Demand and Commodities Prices
Monthly Decline: The PPI decreased by 0.7% month-on-month in August, an expansion of 0.5 percentage points from the previous month. The main reasons for the decline were the decrease in prices of high-consumption energy-intensive industries, such as the iron and steel smelting and rolling industry, the non-ferrous metal smelting and rolling industry, and the petroleum and coal processing industry.
Year-on-Year Decline: The PPI decreased by 1.8% year-on-year in August, an expansion of 1.0 percentage point from the previous month. The main contributors to the decline were the iron and steel smelting and rolling industry, the non-metallic mineral products industry, the food processing industry, and the petroleum and natural gas exploitation industry.
Conclusion
The mixed trends in the CPI and PPI indices reflect the complex economic situation in China. While consumer prices are rising, indicating a certain level of inflationary pressure, producer prices are falling, suggesting a weakening demand in the industrial sector. The government will likely continue to monitor these indices closely and implement appropriate policies to stabilize the economy.
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