China Inflation

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China: Inflation hits five-month low in October

November 10, 2015

In October, consumer prices fell 0.3% over the previous month, which contrasted the 0.1% increase tallied in September. The monthly reading mainly reflected much lower prices for food.

Inflation moderated from 1.6% in September to 1.3% in October. The print fell short of the 1.5% that market analysts had expected and represented the lowest print since May. The trend resumed the downward trend that began in 2014, with annual average inflation falling from 1.5% in September to 1.4% in October, which marked an over five-year low.

Meanwhile, the producer price index fell 5.9% in October over the same month last year, which mirrored September’s reading. The print matched market expectations and marked the lowest level since September 2009. The annual average variation of the producer price index decreased from minus 4.4% in September to minus 4.7% in October, which represented the lowest value since 2009.

The government set an inflation target of 3.0% for 2015. FocusEconomics Consensus Forecast participants expect that inflation will average 1.5% in 2015, which is unchanged from last month’s estimate. In 2016, the panel sees inflation edging up to 1.9%, which is down 0.1 percentage points from last month’s estimate. Meanwhile, the panel expects producer prices to decline 4.4% in 2015, which is up 0.1 percentage points from last month’s projection. In 2016, panelists see producer prices falling 2.4%, which is down 0.3 percentage points over the previous month’s Consensus.


Author: Ricard Torné, Head of Economic Research

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China Inflation Chart


China Inflation October 2015 0

Note: Year-on-year and annual average variation of consumer price index in %.
Source: National Bureau of Statistics of China (NBS).


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