China’s annual consumer inflation slowed to the lowest rate in a year in February, with consumers still cautious despite the abandonment of tight pandemic controls in late 2022.
Combined with the persistence of producer deflation, also released on Thursday (9), the data showed that price pressure has not become an obstacle to further government action seeking to sustain the post-COVID-19 economic recovery, they said. analysts.
The consumer price index advanced 1.0% year-on-year in February, at the slowest pace since February 2022, the National Bureau of Statistics (NBS) said.
The result was well below the expectation of a high of 1.9% in a Reuters poll and the annual increase of 2.1% seen in January.
The government is targeting an average level for consumer prices this year of around 3% compared to 2022.
Zhiwei Zhang, president of Pinpoint Asset Management, said the numbers conflicted with other data showing considerable strength in domestic demand.
“However, weak consumer inflation makes room for the government to adopt more monetary easing policies,” he said.
However, economists generally do not expect major changes in monetary policy this year. The government cut bank reserve requirements twice last year to stimulate the economy.
The statistics bureau attributed the slowdown in consumer price growth to slumping demand after the Lunar New Year holiday in January. Most fresh food prices have fallen as a result of warm weather and plentiful supply, he said.
The index, which is seasonally adjusted, fell 0.5% from the previous month, against expectations of an increase of 0.2% and an increase of 0.8% in January.
Producer deflation deepened in February and reached the fifth straight month.
The producer price index fell 1.4% year-on-year in February, largely due to lower commodity costs. The expectation was for a drop of 1.3% in a Reuters poll, after a contraction of 0.8% observed in January.
Source: CNN Brasil

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