China’s consumer prices remained flat in September, despite signs of an economic rebound, with deepening chronic deflationary pressure and stubbornly weak domestic demand still looming large.
Chinese data provider Wind had predicted a CPI increase of 0.2 per cent in September.
CPI in the first nine months of the year rose by 0.4 per cent, year on year, far below Beijing’s annual control target of 3 per cent.
Foreign tourism in China struggles to hit pre-pandemic levels
Foreign tourism in China struggles to hit pre-pandemic levels
Meanwhile, China’s producer price index (PPI) – which reflects the prices that factories charge wholesalers for products – fell by 2.5 per cent in September, narrowing from a fall of 3 per cent in August. The indicator has fallen for 12 months in a row.
Wind had predicted a PPI fall of 2.4 per cent last month.
But as travel enthusiasm wanes along with the end of the summer season, Zheshang Securities said last week that there has been a slowdown in the development of the cultural and tourism market, while average hotel prices in Beijing and Shanghai are facing downward pressure.
Overall, though, they expect core inflation will show an upwards trend in the future as the economy stabilises.
Some had also warned that sluggish demand would haunt the underpowered economic recovery.
But China’s deputy central bank governor, Liu Guoqiang, denied the deflation claims in July, and said consumer inflation was expected to rise from August to around 1 per cent by the end of the year.
