China has been cautiously navigating its country’s economy balancing between Covid-19 safety measures and supporting industries to operate again.
With cases whipsawing every 2 months, the Middle Kingdom seems to relax some of its zero policy by allowing manufacturing sectors to resume output. The easing has been significantly reflected in the latest Consumer Price Index and Production Price Index released recently by the National Bureau of Statistics. These are indicators of how the country is doing in terms of economic activity.
As of June, China’s producer price index, which measures costs for goods at the factory gate, went up 6.1 percent year on year a clear sign activity in the factories is picking up again after months of shutdown. This would also indicate orders are increasing on the back of strong demand.
The NBS also indicated the consumer price index (CPI), the main gauge of inflation is 2.5 percent higher year on year, which shows the nation is facing the global inflation impact of the rising cost of goods. CPI in May was also higher at 2.1%.
While Central Banks in Europe, US, and Asia, increase interest rates, China has been bringing its rates down to spur activity and increase stimulus packages for industries and retail.
