5.2.3. Impacts on PPI

Figure 8 expresses the PPI changes. Due to the improvement of TFP, PPI changes in various products and services show apparent inconsistency. Specifically, the prices of energy-intensive commodities (such as refined oil and refined gas) have increased to a certain extent. Nevertheless, the PPI of non-energy-intensive enterprises, such as agriculture, light industry, and service industry, has decreased significantly.

The overall PPI is declining, but there is heterogeneity in the PPI of different industries. The main reason is that the increase in total factor productivity reduces the production cost of enterprises, so the overall price will decrease. However, due to the constraints of carbon emissions under the carbon neutrality target, carbon pricing will increase due to the increased energy demand, which will increase the product prices of energy-intensive enterprises.

**Figure 8.** Impacts on producer price index in 2060.
