China's August Factory Inflation Quickens as Energy Costs Bite

China's factory-gate inflation picked up pace in August, while consumer price gains also accelerated, according to official data released on Wednesday. The trend reflects elevated energy costs driven by supply risks and maritime disruptions linked to the Middle East conflict.

The Producer Price Index (PPI), which tracks prices at the factory gate, rose 3.8% in August from a year earlier. This marks an acceleration from the 3.5% increase recorded in July and came in slightly above market expectations of a 3.6% rise.

Separately, the Consumer Price Index (CPI) increased 0.8% year-on-year in August, up from a 0.5% gain in the previous month. The reading was in line with forecasts.

On a month-on-month basis, consumer prices rose 0.4% in August, a sharper increase than the 0.3% gain anticipated by analysts. This also reversed the 0.1% decline seen in July.

The data suggests that while domestic demand remains relatively subdued, external cost pressures are gradually feeding through to consumer prices.