In a sign of the slowdown in economic activity in February in the wake of the intensification of the coronavirus crisis, Chinese producer price inflation dipped back into deflation in February.
The country’s National Bureau of Statistics (NBS) said producer prices in February fell 0.4% from a year earlier and the 0.1% rise (after more than six months of contraction) in January.
Analysts had forecast a 0.3% dip in the PPI after the two surveys of Chinese manufacturing activity showed record lows in February as the virus shut down much of the country.
China locked down Wuhan and some cities in Hubei province, the epicenter of the outbreak, and imposed restrictions in other cities to contain the spread of the virus from late January.
That made it likely China’s economy will show negative growth in the three months to March.
China’s consumer price inflation rose an annual 5.2% last month, easing from the 5.4% rate in January and matching market forecasts.
Food prices in February grew 21.9% from a year earlier, accelerating from 20.6% in January.
Pork prices were again the main culprit, surging 135.2% in February, from a year ago and much higher than the 116% rise in January.
Pork prices alone boosted headline CPI by 3.19 percentage points in February, the NBS said.
Non-food prices rose 0.9% in February, easing from a 1.6% increase in January.
Consumer prices in February rose 0.8% on month, moderating from a 1.4% growth in January.
Both easings hint at the impact of the virus on economic activity across the economy.
