China’s producer prices contracted for the first time in two years

According to official data, China’s producer price index deflated for the first time since 2020, affected by lower iron and steel prices.

The Producer Price Index, which measures the prices of raw materials and other input costs, shrank 1.3% in October from a year ago, a Reuters poll showed, slightly disappointing expectations for a 1.5% decline.
In October, ferrous metals, which includes iron and steel, and the coal industry saw the biggest declines within the PPI.

While inflation is rising in the US and Europe, the consumer price index in China has remained low due to weak domestic demand, and strict Covid controls have reduced growth in China to 3% during the third quarter of the year.