China’s producer index added 9% in May
Prices for products leaving China’s factories or “China Factory Gate Prices” have risen at the fastest rate in over 12 years, as a result of a surge in global commodity prices.
It has turned its attention to inflationary pressures while policymakers are trying to stimulate the economy in the aftermath of the coronavirus-induced slump.
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China’s producer index added 9% last month. Data from the National Bureau of Statistics was revealed Wednesday. This figure surpasses economists’ forecasts and is the biggest jump from the previous year since the 2008 financial crisis.
Analysts who participated in the Reuters poll had predicted that PPI would rise by 8.5% after a 6.8% jump in April.
The sharp rise in this measure in recent months has been driven by a global gathering of goods, in addition to the low foundations seen most of 2020.
China’s rising production costs could ring an alarm bell for us and people all over the world amid continuing concerns about levels of inflation.
“The worry is that PPIs can hover at high levels over a long period of time and can cause economic headaches if mid- or downstream companies can’t absorb higher costs.”
The news comes as investors turn to US inflation reading on Thursday, as they fear the Fed may be forced to start governing its stimulus packages.
US Senate bill
The US Senate voted 68-32 to approve a new law aimed at increasing the country’s ability to compete with China in your technical aspects.
The measured measurements passed Tuesday, enabling a provision of approximately $190 billion to enhance US technology and research.
Senate Majority Leader Chuck Schumer, co-sponsor of the measure, warned against the disastrous consequences of not funding research to protect China.
“If we do nothing, our days as a dominant superpower are over. We are not going to end those days with our watch. In this century, America is the center of the country. I’m not going to see it happen,” Schumer said.
