Also in May, China removes the formal risk of deflation, i.e. a generalized decrease in prices which generates an increase in the purchasing power of the currency. The data, measured by the consumer price index, in fact marks an annual increase of 0.3%, the same as April and less than the 0.4% expected, maintaining a recovery for the second month in a row with the recovery in demand internal. This is what the Chinese National Bureau of Statistics reports.
On a monthly basis, inflation performance was -0.1%, a sharp retreat compared to April’s growth of +1%.
Food, tobacco and alcohol prices fell 1.0% year-on-year; within this category, meat prices decreased 2.2%, while pork prices increased 4.6%.
Economists say a further round of stronger and more coordinated fiscal and monetary stimulus measures is needed to sustainably boost demand.
The other parameter of inflation, the producer price index, also for May, was also released. The figure, stuck in deflation since September 2022, fell at a slower pace of 1.4% in May after contracting 2.5% in April, and compared with an expected decline of 1.5%. This is the twentieth straight month of decline at the softest pace since February 2023. On a monthly basis, the increase is 0.2%, the first in six months (-0.2% in April).
PHOTO: SHUTTERSTOCK
