China Producer Prices Change

China's producer prices declined by 2.8% year-on-year in September 2024, steeper than a 1.8% fall in the previous month and market forecasts of a 2.5% drop. This marked the 24th consecutive month of producer deflation and the sharpest contraction since March, driven by persistently weak domestic demand despite Beijing's continued efforts to reverse the trend. The cost of means of production saw a sharper decrease (-3.3% vs -2.0% in August), largely due to further falls in mining (-2.5% vs 0.9%), raw materials (-3.2% vs -0.8%), and processing (-3.3% vs -2.7%). At the same time, prices of consumer goods continued to shrink (-1.3% vs -1.1%), weighed down by food (-1.6% vs -1.3%), clothing (-0.3% vs -0.4%), daily-use goods (-0.3% vs flat), and durable goods (-2.1% vs -1.9%). On a monthly basis, producer prices fell by 0.6%, following a 0.7% drop in August. For the first eight months of the year, producer prices decreased by 2.0%.