Inflation in China slowed in March as the country’s recovery from extended Covid-19 lockdowns is slower than hoped.
The CPI rose 0.7% year-on-year, the slowest rise in 18 months and less than economists had expected. Ex-factory prices fell 2.5% annually, the biggest drop since June 2020.
The…
Inflation in China slowed in March as the country’s recovery from extended Covid-19 lockdowns is slower than hoped.
The CPI rose 0.7% year-on-year, the slowest rise in 18 months and less than economists had expected. Ex-factory prices fell 2.5% annually, the biggest drop since June 2020.
The price weakness suggests that economic demand is struggling to recover after the country emerged from severe pandemic restrictions on activities late last year. As the world’s second largest economy, China’s poor performance this year could impact global expansion. Companies like Apple (Ticker: A`L) and Tesla (TSLA) rely on China both as a production center and as a sales market for their products.
The Chinese government has a consumer price target of 3% in 2023 after the consumer price index rose by 2% last year. At the end of March, the central bank lowered the minimum reserve requirement for banks by a quarter point.
The key question now is how much further support the government is willing to support growth. First quarter gross domestic product figures are due on April 18th.
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Write to Brian Swint at [email protected]
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