30 March 2017
China Sourcing Update: Price Index for US Imports from China (Feb 2017)
Price index for US imports from China rebounds slightly
Compiled by the US Department of Labor, the price index for US imports from China edged up to 100.1 in February from a nine-year low of 100.0 (revised downward from the previously released figure of 100.1) in January (see exhibit 1).
In our view, the latest index reading indicates a slight rebound in prices of US imports from China after nearly five years of continuous fall. Possible reasons include a relatively stable exchange rate of the Chinese yuan against the US dollar, and the bottoming-out of ex-factory prices of Chinese products in Renminbi terms in recent months.
Looking ahead, as material costs have continued to climb, the ex-factory prices of Chinese products are expected to increase further in the foreseeable future. Therefore, we predict that the price index for US imports from China will continue to rise in the coming months.
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