China’s consumer prices dip back into decline amid limp demand

China’s consumer prices dip back into decline amid limp demand

China’s consumer prices fell and factory-gate deflation continued in October, indicating challenges for the country’s economic recovery. The consumer price index (CPI) dropped 0.2% in October, driven by a decline in pork prices. Core inflation, which excludes food and fuel prices, also slowed. This persistent disinflationary trend raises concerns about China’s ability to meet its inflation target. Consumer prices slipped into deflation in July and returned to positive territory in August but remained flat in September. Factory deflation has persisted for the 13th consecutive month. These indicators suggest that a meaningful economic recovery is still out of reach.

Economists believe that Chinese policymakers need to implement more supportive measures to combat disinflation and prevent a decline in business confidence and household spending. Month-on-month, CPI fell 0.1%. The producer price index (PPI) also fell, with a 2.6% year-on-year drop in October. Authorities have downplayed the risks of deflation in China, but concerns remain due to a property crisis, local debt risks, and policy divergence with the West. Recent economic indicators have been mixed, with unexpected growth in imports but contraction in exports. The official purchasing managers’ index showed contraction in factory activity and slowing services activity. China also recorded its first-ever quarterly deficit in foreign direct investment, highlighting capital outflow pressure.

Moody’s expects China’s economy to grow by 5.0% in 2023, in line with the government’s target, but downside risks exist due to structural factors. The country has implemented measures to support the economy, including sovereign bond issuance and allowing local governments to frontload their bond quotas. However, the recovery process is complicated by various factors. Overall, the data indicates that China’s economic recovery is still uncertain, and policymakers need to take appropriate measures to address disinflation and stimulate growth.

About News Team

News TeamHi, I'm Alex Perez, an experienced writer with a focus on lifestyle and culture news. From food and fashion to travel and entertainment, I love exploring the latest trends and sharing my insights with readers. I also have a strong interest in world news and business, and enjoy covering breaking stories and events.

Have a tip we should know?

Most Read

  1. News
    Pandora Papers Financial Leak Shows Us the Secrets of the World’s Rich and Powerful
    2 years ago
  2. Health
    US Supreme Court Rejects J & J TALC Cancer Case Appeal
    3 years ago
  3. Lifestyle
    9 Habits that Drain your Daily Focus and How to Avoid Them
    3 years ago
    Women’s Demand for Shapewear – the big Trends
    3 years ago
    Valentino Launches its Cosmetics Line
    3 years ago
  6. Health
    US Promises to Share 60 million Doses of AstraZeneca Vaccines
    3 years ago
  7. Health
    UK Offers Aid Amid Surging COVID-19 Cases in India
    3 years ago
  8. Sports
    Thousands of fans welcome Charlton funeral cortege at Old Trafford
    4 weeks ago
  9. News
    Brit left fighting for life after train derails in Argentinia
    4 weeks ago
    Dubai faces down airline rivals with $50 bln jet orders
    4 weeks ago
  11. Sunak
    UK’s Sunak brings back Cameron, sacks Braverman
    4 weeks ago
  12. Sports
    Man United’s Hojlund, Eriksen withdrawn from Denmark team duty
    4 weeks ago
  13. Health
    Autumn Sneezing Syndrome is on the rise… here’s what you can do
    4 weeks ago
  14. Canada
    Canada beat Italy to win Billie Jean King Cup for first time
    4 weeks ago

Follow @rushhourdaily: