HONG KONG—China’s factory-gate prices surged by the most in nearly 13 years in May, escalating global concerns about rising commodity costs and squeezed profit margins for businesses, and raising pressure on Beijing to rein in prices.
China’s producer-price index jumped 9.0% from a year ago in May, accelerating from April’s 6.8% increase, the National Bureau of Statistics said Wednesday. The result topped the 8.6% increase expected by economists polled by The Wall Street Journal, and marked the fastest year-over-year rise since September 2008, when producer prices rose 9.1%.
The statistics bureau said that soaring crude-oil, iron-ore and metals prices boosted factory-gate prices last month, and drove China’s imports to the fastest increase in over a decade.
“Industrial inflation pressure will likely remain and pose additional risks to economic growth,” Citigroup economists said in a note, adding that there is no quick fix to this round of commodity-led inflation.
In recent weeks, several research houses, including ANZ and Standard Chartered , have raised their forecasts for China’s PPI after signs of accelerated price gains.