2023-12-09 14:24:34
Update
December 9, 2023
15:24
The consumer price index, the main indicator of inflation, fell by 0.5% year-on-year in November. This is a threat to the Chinese economy as a whole.
Deflation in China accelerated in November, official data showed on Saturday, underscoring the difficulties facing the world’s second largest economy to restart the request.
On Friday, President Xi Jinping said that the Asian giant’s post-pandemic recovery was “still at a critical stage” and warned once morest “growing adverse factors in the international political and economic environment.
The consumer price index, the main indicator of inflation, has fell in November by 0.5% year-on-yearaccording to the National Bureau of Statistics (BES).
In October, the index saw a decline of 0.2%.
This decline is linked to “downward fluctuations in energy and food prices”.
A decline in demand can then push companies to reduce their production, freeze hiring or lay off employees, and decide on further price reductions to sell off their stocks, slowing down their profitability while costs remain the same.
Although deflation appears to indicate that goods are less expensive, it constitutes a threat to the economy as a wholebecause consumers tend to postpone their purchases in the hope of further reductions.
The BES also indicated that producer prices fell for the 14th month in a rowsliding 3% over one year, compared to 2.6% the previous month.
Mr. Dong attributed the decline to “a rebound in international oil prices who has weakened demand for certain industrial goods.
China’s economy grew a modest 4.9% in the third quarter, slightly below Beijing’s annual target of around 5%, one of the lowest in years.
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