Producer Price Index Also Falls by 2.3%
China's Consumer Price Index (CPI) has remained in negative territory for two consecutive months, raising concerns about deflation-a decline in prices amid economic stagnation.
According to the National Bureau of Statistics of China on October 15, the CPI for September fell by 0.3% year-on-year. This marks the second consecutive month of negative growth, following a 0.4% decline in the previous month, and the drop is steeper than the market forecast of -0.2% compiled by Reuters.
The Producer Price Index (PPI) for September decreased by 2.3% year-on-year, in line with Reuters' expectations. China's PPI has remained negative for 36 consecutive months since October 2022.
While the world faces inflationary concerns due to the high-tariff policies of the Donald Trump administration in the United States, China is experiencing deflationary pressure stemming from weak demand and excessive price competition within industries.
Since Premier Li Qiang of the State Council announced at the National People's Congress in March that the government would crack down on inefficient and disorderly "neijuan" (internal competition), the Chinese government has repeatedly expressed its determination to prevent cutthroat price competition in specific sectors such as electric vehicles, solar energy, petrochemicals, and steel.
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