China’s PPI, CPI and Foreign Trade: What You Need To Know October 2023

The latest economic indicators from China provide an optimistic picture of its economic landscape. Declining producer prices, stable consumer inflation, and a modest drop in foreign trade all point to ongoing stabilization.

Key Points

  • Producer Price Index (PPI) declined by 2.5% year-on-year in September, improving from a 3% decline in August.
  • Consumer Price Index (CPI) remained flat year-on-year but rose 0.2% on a monthly basis.
  • Foreign trade reached 30.8 trillion yuan in the first three quarters, declining 0.2% year-on-year.
  • Exports fell 6.2%, and imports also declined 6.2% in September, both showing an improvement compared to August.
  • China’s trade surplus increased to $77.71 billion in September, up from $68.4 billion in August.

Producer Price Index Shows Signs of Stabilization

Data from China’s National Bureau of Statistics (NBS) reveals a year-on-year decline of 2.5% in the Producer Price Index (PPI) for September. This indicates an improvement compared to the 3% decline in August and a 4.4% decrease in July. On a month-to-month basis, the PPI in September edged up by 0.4%.

Consumer Price Index Holds Steady

The Consumer Price Index (CPI), a widely used measure for inflation, held steady year-on-year in September. However, the CPI rose by 0.2% when compared to the previous month. The Core CPI, which excludes the often-volatile food and energy components, increased by 0.8% year-on-year, maintaining the rate observed in August.

Foreign Trade: A Minimal Decline Amid Global Challenges

Customs data indicates a 0.2% year-on-year decrease in China’s foreign trade, which amounted to 30.8 trillion yuan in the first three quarters of 2023.

Trends in Export-Import Dynamics

September saw exports decline by 6.2% year-on-year to $299.1 billion, an improvement from the 8.8% fall in August. Imports also fell by 6.2% to $221.4 billion, a decline compared to 7.3% in the previous month. The trade surplus for September stood at $77.71 billion, increasing from $68.4 billion in August.

Varied Performance with Key Trading Partners

Exports to the Association of Southeast Asian Nations, China’s largest trading partner, contracted by 15.82%. Exports to the United States fell by 9.34%, and those to the European Union dropped by 11.61%. However, exports to Russia increased, surging by 20.58% year-on-year in September.

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