China’s May factory gate prices fell by the sharpest rate in more than four years, underscoring pressure on the manufacturing sector as the COVID-19 pandemic reduces trade flows and global demand, reported Reuters.
The pandemic has disrupted trade to China’s key export markets including the United States and Europe, heaping further pressure on the outlook for manufacturing investment and jobs in the world’s second-largest economy.
The producer price index (PPI) in May fell 3.7% from a year earlier, the National Bureau of Statistics (NBS) said in a statement on Wednesday, the sharpest decline since March 2016. That compared with a 3.3% drop tipped by a Reuters poll of analysts and a 3.1% fall in April.
Exports contracted in May as global coronavirus lockdowns continued to devastate demand while a deeper fall in imports pointed to mounting pressure on the key manufacturing sector. Official and private factory surveys also indicated deep contractions in export orders.