China producer prices rise 5.7% in October

China's producer prices rose 5.7 percent year-on-year in October, official data showed Monday, marking their fastest growth since June 2022 as consumer inflation remained below target.

The National Bureau of Statistics said factory-gate prices rose more than the 5.3 percent estimated in a Bloomberg survey of economists. The producer price index has picked up since the start of the Iran war at the end of February, ending more than three years of falling prices.

“Higher global energy and AI-related electronics prices continued to be the main drivers,” Nguyen Hoang Nam of Capital Economics wrote after the data release.

He said Capital Economics expected the external price shock to persist in coming months but fade next year, with producer prices returning to deflation.

Other data from the National Bureau of Statistics showed that consumer inflation remained weak. The consumer price index rose 0.7 percent year-on-year in October, down from 0.9 percent in September and below the 0.8 percent forecast in a Bloomberg survey.

The reading remained well short of Beijing's official inflation target of around two percent.

China's economy has been supported in recent years by an export boom, driven partly by global demand for AI-related products. Trade figures due Tuesday are expected to show strong performance continued through October.

Beijing is targeting annual gross domestic product growth of 4.5 to 5.0 percent this year. The economy expanded 4.5 percent in the third quarter, up from 4.3 percent in the previous three months.