China’s consumer inflation rate remains lower than projected as trade war concerns weigh on economy
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The National Bureau of Statistics reported that China’s November consumer inflation slowed down than projected, rising by only 0.2% compared to last year. Analysts polled by Reuters expected November prices to increase by 0.5% instead of the 0.3% October increase. China’s producer price index dipped for the 26th consecutive month, with November’s drop of 2.5% lesser than the 2.8% predicted by the analysts in the Reuters poll. The decline in factory prices was also lower compared to the same period last year. Core inflation, which excluded volatile fuel and food prices, climbed 0.3% in November from October’s 0.2%. Year over year, pork and fresh vegetable prices rose by 13.7% and 10%, respectively. The prices of ferrous metal materials fell by 7.1%, leading to a decline in the purchaser price index of industrial producers. Chemical raw materials plunged 5%, while fuel and power saw a 6.5% drop. Experts believe China’s deflation will continue amid trade wars China consumer prices climb less than expected as economy slows amid trade war worries https://t.co/rC1SLLfQVd — CNBC (@CNBC) December 9, 2024 Erica Tay, the director of macro research at Maybank, said that China’s PPI deflation still seemed ‘quite entrenched’ although it had narrowed slightly. She told CNBC that accumulated producer inputs and finished goods inventories were sizable and grew from month to month. According to the National Bureau of Statistics (NBS) report, persistent near-zero retail inflation showed that China’s economy struggled with low domestic demand as wholesale prices remained deflationary. Domestic demand remained sluggish despite Beijing’s series of stimulus efforts since September, which included interest rate cuts, support for stock and property markets, and efforts to incentivize bank lending. “We believe deflation will continue in China, especially based on the previous experience during trade wars.” ~ Becky Liu, Head of China macro strategy at Standard…
Filed under: News - @ December 9, 2024 9:19 am