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China February Factory Prices Rise 2.6%

Higher raw material and energy prices are cause.

On higher raw material and energy prices, China's factory-gate prices in February rose 2.6% from a year earlier government data showed March 12.

The increase compared to a 3.3% gain in January and a rise of 3% for all of 2006, the National Bureau of Statistics said. However the figures, which were well below analysts' estimates ranging 3.3%-3.6%, would have been impacted by last month's weeklong Chinese Lunar New Year holiday.

The subdued factory-gate prices could point to continued low consumer inflation in China, analysts said. Chinese Premier Wen Jiabao told parliament last week that China's inflation rate should remain below 3% in 2007.

China's consumer price index, the key measure of inflation, rose 1.5% last year. In January, it rose 2.2% from a year earlier.

Copyright Agence France-Presse, 2007

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