According to the latest data from the National Bureau of Statistics of China, the country’s Consumer Price Index (CPI) rose 2.1% from the prior year. This is the fastest pace in five months.
Particularly, the price of agricultural produce increased significantly in April due to strict Covid-19 restrictions.
Fresh vegetable prices are 24% more expensive than a year ago, while eggs, fruit, and potatoes also rise 12% to 14% higher.
Nikkie Asia reported that China’s strict zero-COVID measures are behind the increase.
China has imposed strong lockdowns on financial hub Shanghai with 25 residents amid the latest Covid outbreak. The city has been under lockdown for about two months with no sign of easing from authorities.
Due to supply chain disruption, challenges for delivery to virus-hit areas, among others, help drive the April inflation.
Besides, fuel price increase affects transportation costs, which further worsen the problem.
Earlier this month, China’s National Bureau of Statistics data showed that the manufacturing and services sectors dropped sharply in April. The data is the lowest in more than two years due to the Zero-Covid strategy on China’s overall economy.
The purchasing managers’ index for the manufacturing sector fell to 47.4 in April, down from 49.5 in March.
Experts recently also share their pessimistic outlook on China’s economy.
Singapore’s sovereign fund Temasek Holdings Pte. has forecast China’s economy is near the bottom, and there is a chance its growth could bounce back later this year.
According to Le Monde, industry insiders point out that the current state of China’s economy is facing the biggest problem in 30 years. The current state of China’s economy results from a shaking investment market, massive foreign capital outflow, and the complicated investment situation in China.