China still can't beat deflation as its economy continues to flounder
Andy Wong/AP Photo
- China remains on the brink of deflation, according to official figures published Friday.
- Consumer prices were flat and producer prices slumped 2.5% in September, the data showed.
- Beijing has made some moves to support China's faltering economy in recent months, but stopped short of rolling out a "big bang" stimulus package.
China's battered economy still can't shake off the threat of deflation, official government figures released Friday show, as a key gauge of price rises unexpectedly flattened.
The country's consumer price index was unchanged last month, the National Bureau of Statistics said. The CPI slid back to zero after edging up just 0.1% in August.
Meanwhile, factory-gate costs as measured by the producer price index fell 2.5% in September for their 12th consecutive monthly decline, the data showed.
Both price indices fell short of economists' expectations, per Reuters polls conducted before the figures were published. The flagship CSI 300 stock-market gauge fell 1% Friday on the government's latest economic report card, while Hong Kong's Hang Seng index dropped over 2%.
Policymakers have been battling slumping prices, stagnant growth, and a property-market crisis for much of 2023, with China's long-heralded lifting of zero-COVID measures at the end of last year failing to reboot the world's second-largest economy.
Beijing has made some moves to try to boost demand, but its interventions have fallen short of the so-called "big bang" stimulus package that investors believe will be necessary to spark a revival.
There was some better news for China Friday, though, as separate data showed a less-than-expected decline in exports for September.
Forecasters tend to see deflation as a worrying sign for any economy, because people start to hold off on buying things under the expectation that they'll become cheaper in the future, fueling a slowdown in spending that can drag on growth.