China: Inflation rises in December
Consumer price inflation came in at 1.8% in December, which was up from Novembers 1.6% but was still weak by international standards due to depressed demand. Among key subsectors, food prices saw the largest rise, while housing prices declined amid the depressed property market.
Annual average inflation rose to 2.0% in December (November: 1.9%). Meanwhile, producer prices fell 0.7% on an annual basis in December, which was a smaller fall than November’s 1.3% decrease.
Finally, consumer prices were flat in December over the previous month, after the 0.20% drop seen in November.
Looking to 2023, both consumer and producer price inflation are expected to be mild, as upward price pressure from a recovery in domestic demand should be partially offset by lower average commodity prices and the normalization of international supply chains.