China moves into deflation as prices fall for first time since early 2021

CPI fell 0.3% in July

China’s economy has slipped into deflation for the first time since early 2021 after the country struggled to revive consumption.

According to the National Bureau of Statistics (NBS), the world's second-largest economy saw its consumer price index fall by 0.3% in annual terms in July. Meanwhile, factory gate prices saw further declines, falling by 4.4%. Consumer prices last slipped into negative territory in February 2021, and fears have run high this year of re-entering as an expected rebound in consumer spending failed to materialise after authorities lifted pandemic restrictions at the beginning of this 2023. Average CPI over the year so far has been 0.5%, severely lagging the government's target average infl...