China’s factory gate prices fell into deflationary territory last month for the first time since 2020 and consumer prices rose less than expected, in further signs of the damping effect of COVID-19 lockdowns on domestic demand, reports the Financial Times. The country’s producer price index, a gauge of prices for goods as they leave factories, which are heavily determined by energy and raw material costs, fell 1.3% in October year on year, its first decline since December 2020. The consumer price index rose 2.1%, missing forecasts of 2.4%.
While global economies have grappled with soaring prices over the past year, inflation in China has remained subdued as persistent COVID restrictions intended to eliminate the virus have constrained consumer activity.
Authorities have imposed frequent lockdowns and now require almost daily mass testing to contain outbreaks. Nationwide daily cases reported on Wednesday rose to 8,335, spurred by an outbreak in Guangzhou and the highest total in Beijing in five months.