Deflationary pressure continues in China

China’s National Bureau of Statistics (UIB) announced October 2023 data on price increases in the country.

In October, the consumer price index (CPI) decreased by 0.2 percent and the producer price index (PPI) decreased by 2.6 percent compared to the same period last year.

Therefore, the continued decline in producer prices and stagnation in consumer prices in the country increased concerns about the risk of deflation.

THE DECLINE IN THE PPI IS IN ITS TENTH MONTH

While producer prices in the country have been falling for more than a year, the stagnation of consumer prices continues.

The decline recorded in the last quarter of 2022 by the PPI, calculated from the ex-factory prices of manufacturing products, continued in the 10 months of the year. The PPI declined 2.6 percent in October, continuing the 2.5 percent decline in September.

The CPI, which is considered the main indicator of inflation, continued its stagnation by declining 0.2 percent in October after remaining stable in September.

CONSUMER PRICES INCREASED ONLY 0.4 PERCENT IN 10 MONTHS

While food prices decreased by 4 percent in October, non-food prices increased by 0.7 percent. Core inflation, which excludes food and energy prices, was 0.6 percent.

At a time when inflation is high in the world, especially in developed economies, after Covid-19, it is observed that the reverse trend is deepening in China.

Consumer prices in the country rose only 0.4 percent in 10 months this year compared to the same period last year.

Price increases are expected to fall below the government’s 3 percent inflation target for this year. (AA)