City skyline in China

China Inflation May 2024

China: Consumer inflation remains stable in May; producer prices fall

Consumer inflation was stable at April’s 0.3% in May, undershooting market expectations. Higher non-food prices were largely offset by lower food prices. Consumer prices fell 0.10% in May over the previous month, contrasting April’s 0.10% rise. Finally, the annual average variation of consumer prices was unchanged at April’s minus 0.1% in May.

Meanwhile, producer prices fell 1.4% on an annual basis in May, which was a more modest fall compared to April’s 2.5% decrease.

Soft domestic demand, huge industrial capacity and the weak housing sector have capped consumer price pressures so far this year, and should continue to do so later in 2024. Over 2024 as a whole, consumer inflation is seen among the lowest levels in Asia.

On the near-term outlook, Nomura analysts said:

“In view of the jump in wholesale pork prices (20.5% y-o-y during 1-11 June), softening leisure services activity during the Dragon Boast Festival, and ongoing auto price cuts, we expect CPI inflation to pick up modestly to 0.4% y-o-y in June. PPI inflation may rise further to -0.7% y-o-y in June, due mainly to a still-low base (June 2023: -0.8% m-o-m). The recent sequential increase in prices of construction materials, such as cement, may also indicate higher PPI inflation. Overall, we expect CPI inflation to stay positive over the remainder of the year, although it may remain below 1% until Q4, due to the sluggish state of the economy.”

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest X Download Fullscreen