Month-to-month Rise of CPI and PPI Goes down in October 2018

　　The National Bureau of Statistics released today the data on the National Consumer Price Index (CPI) and Industrial Producer Price Index (PPI) in October 2018. In this regard, Sheng Guoqing, a senior statistician from the Department of Urban Surveys of the National Bureau of Statistics, gave his interpretation.

　　I. CPI month-on-month rise declines, but the year-on-year rise is the same as that of last month

　　On a month-on-month basis, CPI rose by 0.2%, down by 0.5% over last month. Specifically, food prices declined by 0.3%, causing the CPI to decline by about 0.05%; non-food prices rose by 0.3%, causing the CPI to rise by about 0.24%. CPI month-on-month rise declined mainly because food prices declined from a rise. With regard to food prices, fresh vegetable prices declined by 3.5% due to the centralized supply of autumn vegetables and vegetables stored for winter; when the temperature became cooler, the production capacity of laying hens increased, and the egg prices dropped by 4.0%. The above two factors caused the CPI to decline by about 0.12%. Owing to the increasing demand for meat consumption, pork, beef and mutton prices rose by 1.0%, 1.1% and 1.8%, respectively; given the tight supply in the fresh fruit market, the prices rose by 1.9%. The above four factors caused the CPI together to rise by about 0.07%. With regard to non-food prices, the prices of gasoline, diesel, coal and LNG rose by 4.2%, 4.7%, 2.9% and 1.8%, respectively, causing the CPI to rise by about 0.12%; clothes prices rose by 0.8%, causing the CPI to rise by about 0.06%; the prices of air tickets and tourism declined by 7.2% and 0.9%, causing the CPI to decline by about 0.04%.

　　On a year-on-year basis, CPI rose by 2.5%, same as last month. Specifically, food prices rose by 3.3%, causing the CPI to rise by about 0.64%; non-food prices rose by 2.4%, causing the CPI to rise by about 1.90%. With regard to food prices, the prices of fresh fruits, fresh vegetables and eggs rose by 11.5%, 10.1% and 7.8%, respectively, causing the CPI to rise by about 0.47%; beef, mutton and poultry prices rose by 4.5%, 9.9% and 4.3%, respectively, causing the CPI to rise by about 0.10%; pork prices declined by 1.3%, which was narrowed down for five consecutive months. With regard to non-food prices, housing prices rose by 2.5%, causing the CPI to rise by about 0.55%; prices of educational services and health care rose by 3.2% and 2.6%, respectively, causing the CPI to rise by about 0.43%; gasoline and diesel prices rose by 22.5% and 25.0%, respectively, causing the CPI to rise by about 0.44%. It is estimated that carryover effects of price changes in last year contributed about 0.3% and new price-rising factors contributed about 2.2% to the 2.5% year-on-year increase of the CPI in October.

　　II. PPI month-on-month rise and year-on-year rise decline

　　On a month-on-month basis, PPI rose by 0.4%, 0.2% down over last month. Specifically, the prices of means of production rose by 0.6%, and prices of means of livelihood stayed the same as last month. Among the 40 industrial categories surveyed, 27 industries saw rising prices, 8 industries saw flat prices and 5 industries saw declining prices. Among major industries, the growth of oil, coal and other fuel processing industries declined, increased by 3.1%, 0.9% down over last month; that of chemical raw material and chemical product manufacturing industry rose by 0.9%, 0.1% down. The growth of oil and natural gas mining industry rose by 6.3%, 2.5% up; that of coal mining and washing industry rose by 1.1%, 0.6% up; that of non-ferrous metal smelting and rolling industry rose by 0.5%, 0.2% up; that of non-metal mineral product industry rose by 0.7%, 0.1% up. The growth of chemical fiber manufacturing industry declined by 0.3% from a rise. In addition, the prices ferrous metal smelting and rolling industry stayed the same as last month.

　　On a year-on-year basis, PPI rose by 3.3%, declined by 0.3% over last month. Specifically, the prices of means of production rose by 4.2%, and the prices of means of livelihood rose by 0.7%. Among major industries, the growth of chemical raw material and chemical product manufacturing industry declined, which rose by 6.1%, 0.9% down over last month; that of non-metal mineral product industry rose by 7.3%, 0.8% down; that of non-ferrous metal smelting and rolling industry rose by 6.9%, 0.3% down; that of oil, coal and other fuel processing industries rose by 24.0%, 0.1% down. The growth of oil and natural gas mining industry rose by 42.8%, 1.6% up. The decline of non-ferrous metal smelting and rolling industry expanded by 0.9% to 2.6%. It is estimated that carryover effects of price changes in last year contributed about 1.2% and new price-rising factors contributed about 2.1% to the 3.3% year-on-year increase of the PPI in October.