Consumer prices in China fell at their fastest rate in six months in August, as the country continues to struggle with weak domestic demand, a sluggish property sector, and mounting pressure on exports.
According to data released today by the National Bureau of Statistics NBS, China’s Consumer Price Index CPI, a key gauge of inflation, dropped by 0.4% year-on-year in August. This marks the steepest decline since February, when prices fell by 0.7%. The figure was below market expectations, with Bloomberg economists forecasting a more modest 0.2% decline.
China has been fighting deflationary pressures for months, with low consumer spending continuing to hold back recovery from the pandemic. The prolonged slump in the real estate sector, combined with elevated youth unemployment and low household confidence, has made it difficult for Beijing to hit its 5% annual GDP growth target.
The mixed economic signals come as global markets closely watch China’s ability to navigate a fragile recovery. Analysts say the country must balance structural reforms with immediate stimulus to avoid long-term stagnation.
