China’s Consumer Inflation Slows, Signaling Fragile Demand
In a recent report, China’s National Bureau of Statistics revealed that the country’s consumer inflation rate slowed in September, indicating fragile demand in the second-largest economy globally. Despite efforts to boost domestic activity and support the struggling property sector, the consumer price index rose by only 0.4 percent year-on-year, lower than the 0.6 percent forecast.
With ongoing deflation concerns, the government announced plans for a significant fiscal stimulus package, including issuing special bonds to bolster banks and lower interest rates on existing mortgages. The aim is to stimulate household consumption and address the property market crisis that has plagued the economy for years.
While Beijing is optimistic about achieving its annual economic growth target of around five percent, experts remain cautious due to challenges such as high youth unemployment and the lingering effects of the pandemic. The new measures aim to draw a line under these issues and pave the way for a stronger post-pandemic recovery.