Market Updates
Persistent Demand Weakness Drags Consumer Price Inflation In China
Li Chen
11 Apr, 2024
Hong Kong
Consumer price inflation rose less than expected, and producer price inflation declined for the eighteenth month in a row.
The consumer price index rose 0.1% from a year ago in March after rising at an annual pace of 0.7% in February, the National Bureau of Statistics reported Thursday.
The inflation index picked up in February because of the slight rebound in demand during the Lunar New Year holiday, when inflation advanced for the first time in six months.
Post-pandemic consumer demand has remained weak for the second year in a row, following worries about job stability and a protracted slump in property prices.
Families in China viewed investing in residential property as a safe bet after prices rose at a steady pace for nearly 25 years. But that began to change over the last eight years.
Property market weakness since 2016 has turned into a full-blown crisis after the zero-covid restrictions halted the completion of several real estate projects and pushed most large developers on the brink of debt defaults.
Core inflation, which excludes volatile food and energy prices, rose 0.6% in the month from a year ago, compared to a 1.2% rise in February and 0.4% growth in January.
Producer price index, a measures of wholesale inflation, eased 2.8% in March from a year ago, faster than the 2.7% annual pace of decline in February.
China has set a target for consumer prices to rise by 3.0%, a lofty goal considering inflation in 2023 was only 0.2%.
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