China’s consumer prices contracted for a second straight month, while the productive price proceeded further, as Chinese exporters braces for more pain between a growing trade war with the US
Consumer price index slide 0.1% year in March in MarchAfter 0.7% contracted in February, the remaining in the deflation sector, according to Data issued by National Bureau of Statistics Thursday.
Economists voted by Reuters expected a flat reading compared to the same period last year.
Manufacturer prices fell for 29th straight month, declining 2.5% One year to March The biggest contraction before and since November 2024.
The Reuters Poll was expected to fall by 2.3%.
Core inflation, which removes unstable food and fuel prices, rose 0.5%, rebounding from 0.1% decline in February, although still lower than an increase of 0.6% in January.
“We are more likely to look at a deviation between consumer prices and productive prices,” said Economist Intelligence Unit senior economist Tianchen Joo.
“Chinese exporters are essentially competing for a small global market,” he said.
US President Donald Trump Tariffs are aars to 125% on sugar imports Overnight, 104%. Hours ago, China retaliated Killing America with 84% tariff on Wednesday.
Bruce Pang, Assistant Associate Professor at the Chinese University of Hong Kong, said, “Data policy stimulation measures, especially with the aim of promoting consumption, especially the potential divine point operated by the initiative, especially the initiative.
Pang said, “With recent policy commitments to curb aggressive value-cutting and additional strategies to encourage domestic expenses, CPI is estimated to display further signs of gradual recovery in the coming months,” Pang said.
Meanwhile, the price of the producer is likely to be a pressure of deflation, with the external demand, in view of the uncertainties around the oil prices and the ongoing trade tension, Pang said.
After the data release, after hitting its weakest level since 2007 in the onshore yuan season, there was a multi-day climb at 7.3469 per dollar. The offshore yuan weakened by 0.23% 7.3611 at dollars.
CSI 300 1.6% of the mainland China increased, while Hong Kong’s Hang Seng index jumped 3.9% A comprehensive recovery in Asian Market.
In March, Chinese Premier Lee Kiang was Gave an annual report on government work Consumption of promoting as a top task for that year was nominated, as the country set an ambitious target of “about 5%” growth.
Laura Wang, the main China equity strategist at Morgan Stanley, said that for the first time in a decade, Beijing has given such a high priority. He said that the government work report cited “consumption” 27 times – the most mentioned in a decade.
Li Daokui, Mansfield Freeman Tsinghua University, Professor of Economics and former Advisor at People’s Bank of China, told CNBC “China connection” On Thursday that Beijing was preparing the focus on increasing domestic consumption, which will be rolled out soon.
With the increasing tariff imposed by the US, “Beijing will double its intensity or quadruple the intensity of increasing domestic consumption,” Lee said, “Within 10 days, we will see announcements from the State Council.”
To increase domestic consumption, Chinese policy maker in March This year double subsidy for a consumer trade-in program for 300 billion yuan ($ 41.47 billion). The subsidy will lead to about 15% to 20% of the purchase price for select products, including mid-range smartphones and home appliances.
This is an expansion from last year’s 150 billion yuan program, declared for a narrow range of products in summer.
China should focus more on domestic demand in view of the possibility of “new shocks” for foreign demands, Shane Danang, head of the drafting group of the Government Work Report and Director of the State Council Research Office, asked reporters in March in Mandarin translated by CNBC.
Chinese officials had said that to meet the development goal, “very difficult tasks” would be required according to a CNBC translation of his statement in Chinese. Increased trade tension between Beijing and Washington has made the situation more complicated.
“While policy makers have indicated more desire to support domestic demand, a lot of fiscal expenses are being dedicated to expand the supply side in the economy,” said Julian Evans-Priced, head of China Economics at Capital Economics.
Evans-Prichard said, “It does not seem enough to compensate the consumption support completely weak exports. Such as, the overcapacea is ready to deteriorate, increases the pressure downwards at the prices,” Evans-Prichard said.
– Evelyn Cheng of CNBC contributed to this report.
