China’s inflation slowed in July, below forecast
Sluggish domestic consumption has vexed Beijing for several years, threatening to weigh down national growth even as exports boom.
China's inflation rate slowed in July, falling below forecasts, according to official data released on Sunday. The Consumer Price Index (CPI), a key measure of inflation, rose 0.5% year-on-year, below the 0.8% forecast by Bloomberg. This was the slowest increase since January. Similarly, the producer price index, which tracks costs at the first point of sale, grew 3.5% year-on-year, down from 4.1% in June and lower than the 3.8% forecast.
These figures indicate that domestic consumption, a long-standing economic challenge for Beijing, continued to underperform, potentially dampening national growth despite the booming exports and high-tech sectors. Economists argue that China must transition to a growth model driven more by consumer spending than by real estate and infrastructure investment.
The slowdown in economic momentum was flagged by a recent meeting of the ruling Communist Party's top decision-makers, who indicated that increased fiscal spending could boost domestic demand, though several months would be needed to gauge the impact. The latest data arrives two days after trade figures for July revealed a surge in both exports and imports, driven by strong demand for AI-related technology products overseas.
Written by urgent.news from Free Malaysia Today's reporting — not their text. Machine-written — it may contain errors, so check the original before relying on it.
