China PPI falls to 6.6 pct in October
10/11/2008 17:24
China's producer price index (PPI), a measure of inflation, rose at a
slower annual rate of 6.6 percent in October, the National Bureau of Statistics
(NBS) announced today.
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.
The
factory gate prices of food climbed 5.4 percent last month from a year ago and
those of durable goods slid 0.4 percent.
In addition, the purchasing prices
for raw materials, fuel and power rose 11.0 percent in October, down from 14.0
percent in September.
The PPI from January to October rose 8.2 percent from a
year earlier, compared with 8.3 percent in the nine months through September,
according to the NBS.
This was attributed to declines in commodities prices
and the lag effect of earlier tightening measures, said Peng Xingyun, a
researcher at the Institute of Finance and Banking under the Chinese Academy of
Social Science (CASS).
Wang Tongsan, another CASS researcher of economics,
said this came also as the global financial crisis and economic slowdown
dampened demand for production materials and Chinese products.
Peng told
Xinhua the easing in inflation would provide more room for the Chinese
government to loosen macro-economic controls to stimulate the economy.
"There
is little chance that inflation would rebound in the near future," Peng told
Xinhua. "The government now focuses on tackling the financial crisis and
spurring economic growth."
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 central bank had
cut borrowing costs three times over the past two months. The State Council
yesterday unveiled a 4 trillion yuan (US$570 billion) stimulus package and said
it would adopt "active" fiscal and "moderately loose" monetary policies.
Peng
predicted the consumer price index (CPI), the main gauge of inflation, could be
less than 4 percent in October. The CPI was 4.6 percent in September.
The NBS
is slated to announce October's CPI data tomorrow.
Xinhua
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