2025.09.1001:36:50UTC+00China Producer Prices Fall the Least in 4 Months

In August 2025, China's producer prices fell by 2.9% compared to the previous year. This follows a 3.6% decrease in July, marking the most significant drop since July 2023, and aligning with market forecasts. This represents the 35th consecutive month of producer price deflation. However, it is also the most modest decline since April, as government initiatives aimed at boosting consumption start to take effect. Costs for production materials decreased at a less pronounced rate (-3.2% compared to -4.3% in July), with mining, raw materials, and processing sectors experiencing smaller contractions (-11.5% vs. -14.0%), (-4.1% vs. -5.4%), and (-2.2% vs. -3.1%), respectively. Meanwhile, prices for consumer goods stayed weak (-1.7% vs. -1.6%), impacted by both food (-1.7% vs. -1.8%) and durable goods (-3.7% vs. -3.5%). Clothing prices showed no change (0.0% compared to -0.1%), and prices for daily-use goods experienced slower growth (0.4% vs. 0.6%). Overall, factory-gate prices declined 2.9% in the first seven months of 2025. On a month-to-month basis, the Producer Price Index (PPI) was stable following a 0.2% decrease in the previous month.