China CPI & PPI Jump in April as Iran‑War Spurs Prices
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- China's consumer price index rose 1.2% year‑on‑year in April, beating the Reuters poll forecast of 0.9% and up from 1% in March.
- China's producer price index jumped 2.8% year‑on‑year in April, the strongest rise since July 2022, far above the 1.6% forecast and up from 0.5% in March.
- Retail gasoline prices surged 19.3% year‑on‑year in April, reflecting higher global energy costs after the Strait of Hormuz blockage.
- Retail sales during the extended Labour Day holiday rose 14.3% year‑on‑year, outpacing the 13.7% growth recorded during February’s Lunar New Year break.
- Nomura warned that the supply‑side driven reflation could pressure corporate profit margins and curb household consumption, even as Beijing may welcome the end of three years of deflation.
Why it matters: Beijing gains a welcome break from three years of deflation, but manufacturers face tighter margins as input costs rise, and consumers may curb spending as higher gasoline and energy prices bite.
