China’s CPI/PPI figures for October point towards rising deflationary pressure

By FXStreet FXStreet (Mumbai) – The data released by National Bureau of Statistics (NBS) today showed the Chinese October consumer price index (CPI) rose 1.3 per cent from a year earlier, declining further from 1.6 per cent in September. It was below the expectations of the Reuters poll of economists who estimated the CPI to come in at 1.5%. The October CPI (MoM) came in at -0.3% vs -0.2% expected.

The producer prices at -5.9% YoY, below the -5.8% expected continued its fall for the 44th straight month giving rise to deflationary pressures. The producer price index (PPI) fell 5.9 per cent in October from a year earlier, equalling September’s figures and slightly below the economists’ forecasts of a 5.8 per cent drop.

The poor figures reflect the slowing of demand growth for many goods. Heavy industrial firms and miners were hit by an extended slump in the real estate sector; the final demand for many of their products was thus particularly poor. The figures further highlighted the already existing trend of falling producer price and low consumer prices.

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Source:: FX Street