In July, China's consumer price index (CPI) recorded a growth rate of 0%. Amid ongoing concerns about deflation, Chinese authorities have attempted to rein in price competition, but there seems to be no clear effect.
According to China's National Bureau of Statistics on the 9th, the CPI for July was the same as in July last year. This is higher than the market forecast by Reuters (-0.1%).
Looking at the change in China's CPI (compared to the same month last year), it rose 0.5% in January this year, coinciding with the announcement of the authorities' domestic demand stimulus policy and the Lunar New Year. It then fell 0.7% in February and showed a continuous decline of 0.1% from March to May.
The CPI for June rose by 0.1%, marking a shift to an increase after five months, but it dropped back to 0% within a month.
Chinese authorities believe that irrational price competition among corporations, known as 'self-harm,' is hindering economic growth amid deflationary pressures. However, there has not yet been any noticeable effect on prices.
On the other hand, state-run media Xinhua reported that there are positive aspects, such as a 0.4% increase in CPI compared to the previous month.
Dong Lijuan, chief statistician at the National Bureau of Statistics, analyzed that this was primarily due to the increase in prices of services and industrial consumer goods, as well as the impact of consumption-boosting policies.
As uncertainties from the U.S.-China trade conflict and sluggish domestic demand persist, the producer price index (PPI) for July fell by 3.6% compared to the same month last year, marking a decline for the 34th consecutive month. This is lower than the market forecast compiled by Reuters (-3.3%).
China's PPI also fell by 3.6% in June, recording the largest drop in 23 months.