China's producer price index (PPI), which measures costs of goods at the factory gate, quickened growth pace year on year in January, fresh evidence of strengthening demand in the world's second-largest economy, official data showed Tuesday.
The PPI rose 6.9 percent year on year in January, an increase on the 5.5 percent registered in December 2016, according to the National Bureau of Statistics (NBS).
This represented the fifth straight month expansion of the PPI on a year-on-year basis and the highest reading since August 2011.
On a month-on-month basis, the PPI edged up 0.8 percent, with the growth pace narrowing down from the 1.6 percent recorded in December 2016.
NBS senior statistician Sheng Guoqing attributed the monthly PPI gain to factors including the carry-over effect of last year's price changes, spiking prices of metal, fuels, chemicals and other raw materials.
Factors including rebounding domestic demand and reducing outdated capacity helped push up the PPI and the index is likely to remain high in the coming months, according to Wen Bin, a senior researcher at China Minsheng Bank.
The January PPI figure outstripped market expectations, and Chinese policymakers should be alert to inflationary pressure caused by rapid PPI growth, according to Wen.
The PPI figures came alongside the release of the consumer price index, which rose 2.5 percent in January year on year, partially due to holiday effects.
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