China’s inflation rose more than expected in March as COVID-19 lockdowns and the fallout of the war in Ukraine pushed up prices in the world’s second-largest economy.
China’s producer price index (PPI), which measures factory inflation, increased 8.3 percent year on year, according to data from the National Bureau of Statistics (NBS) released on Monday, amid rising energy prices and persistent supply chain disruptions.
The increase in factory gate prices was down from 8.8 percent growth in February but still ahead of economists’ forecasts.
China’s consumer price index (CPI), which tracks the cost of everyday goods and services, also rose ahead of expectations, albeit by a modest 1.5 percent year on year, compared with 0.9 percent in February.
Measured against a year ago, food prices fell 1.5 percent, compared with a 3.9 percent decline in February.
Alicia García Herrero, the chief Asia Pacific economist at Natixis in Hong Kong, told that the inflation figures are a worrying sign for the global economy, which is already grappling with soaring prices.
“Because it should have come down since demand has plummeted in March,” García Herrero said.
“I think because of lockdowns food prices are going to increase. [Chinese Premier] Li Keqiang made that point during the latest State Council meeting that he wants the stability of food prices. I think this is extremely important for China and because of the stockpiling of food in China, that’s going to be very bad for the global trend because, probably, China will step up imports of food and that’s going to put additional pressure on global inflation.”
