China Producer Prices Change

China's producer prices shrank by 2.3% year-on-year in December 2024, slower than a 2.5% drop in the previous month, in line with market expectations. It was the 27th straight month of producer deflation but the softest reading since August amid continued efforts from Beijing to stimulate demand at the end of the year. The cost of production materials continued to decline (-2.6% vs -2.9% in November), with further drops in mining (-4.6% vs -4.9%), raw materials (-2.2% vs -2.9%), and processing (-2.7% vs -2.7%). Also, a decline in consumer goods persisted (-1.4% vs -1.4%), due to more declines in food (-1.4% vs -1.5%), clothing (-0.1% vs -0.3%), and durable goods (-3.1% vs -2.7%) while daily-use goods prices quickened (0.6% vs 0.2%). On a monthly basis, producer prices edged down 0.1%, after rising 0.1% in November. For the whole year, factory-gate prices contracted by 2.2%.