China Inflation August 2019


China: Inflation stabilizes in August

September 10, 2019

Consumer prices rose 0.7% from the previous month in August, following July’s 0.4% increase. The print mostly reflected higher prices for food, especially a surge in pork prices as the country is grappling with a shortage of pork supply amid a swine fever outbreak. Analysts estimate that China's pig herd could halve by the end of this year.

Inflation was stable at July’s 2.8% in August. The print was above market analysts’ expectations of 2.6%. Annual average inflation was unchanged at the previous month’s 2.8% in August.

Annual producer prices (PPI), meanwhile, fell 0.8% year-on-year, following July’s 0.3% decline and representing the steepest drop since August 2016. That said, the decrease was smaller than the 0.9% decline expected by market analysts.

FocusEconomics Consensus Forecast participants expect that consumer inflation will average 2.2% in 2019, which is unchanged from last month’s estimate. In 2020, the panel also sees consumer inflation at 2.2%. Meanwhile, the panel expects producer inflation to be 1.7% in 2019, which is down 0.4 percentage points from last month’s projection. In 2020, panelists also see producer inflation at 1.7%.

Author: Ricard Torné, Lead Economist

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China Inflation Chart

China Inflation August 2019

Note: Annual and monthly variation of consumer price index and annual variation of producer price index in %.
Source: National Bureau of Statistics of China (NBS).

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