HIGH inflation is haunting China’s industrial sector, data from HSBC showed yesterday.
Input prices shot up at the fourth fastest rate in the history of the Purchasing Managers Index (PMI).
Economists pointed to low supply of goods, and panic buying in the face of further price rises. Prices of cotton, grain, oil and steel all increased.
And manufacturers passed on the higher costs to consumers, with “factory gate” prices rocketing at a record rate for the index.
Consumer prices hit a 25 month high in November, with food inflation surging beyond 10 per cent.
In response, Beijing could increase rates by a quarter of a per cent, said economist Hongbin Qu from HSBC.
However, economic growth continues to push forwards in China. The PMI, which measures manufacturing business conditions, was 55.3 for November, up from October’s 54.8.