The
People’s
Bank
of
China
(PBOC)
building
in
Beijing,
China,
on
Tuesday,
April
18,
2023.
China’s
economy
grew
at
the
fastest
pace
in
a
year
in
the
first
quarter,
putting
Beijing
on
track
to
meet
its
growth
goal
for
the
year
without
adding
major
stimulus,
while
also
helping
to
cushion
the
global
economy
against
a
downturn. Source:
Bloomberg

Bloomberg
|
Bloomberg
|
Getty
Images

China’s
consumer
price
index
rose
0.1%
in
April
year-on-year,
the
slowest
since
early
2021.
Month-on-month,
prices
declined
by
0.1%.

Economists
surveyed
by
Reuters
expected
to
see
consumer
prices
rise
0.4%
from
a
year
ago
and
remain
unchanged
from
the
previous
month.

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investing
news

April’s
reading
comes
after
China’s
inflation
rate
eased
to
0.7%
in
March
after
marking
a
recent
peak
of
2.8%
in
September.

Inflation
in
China
was
led
by
food
and
services,
according
to
the
National
Bureau
of
Statistics

food
prices
rose
by
0.4%
and
service
prices
rose
1%
from
a
year
ago.
Consumer
goods
prices
meanwhile
fell
0.4%.

The


onshore
Chinese
yuan

weakened
by
0.04%
to
6.9428
against
the
U.S.
dollar
shortly
after
the
release.

China’s

producer
price
index
,
which
measures
prices
paid
by
wholesalers,
fell
3.6%.
Economists
surveyed
by
Reuters
expected
to
see
a
decline
of
3.2%
year-on-year
after
dropping
2.5%
in
the
previous
month.

That’s
a
stark
contrast
to
the
latest
U.S.
inflation
data
overnight
which
showed

consumer
prices
rose
4.9%
in
April


easing
in
the
wake
of
the
Federal
Reserve’s
efforts
to
tame
inflation
by
hiking
rates

10
consecutive
times
.

Inflation
has
largely
moderated
in
China
following
its
reopening,
prompting
market
watchers
to
question
whether
the
world’s
second-largest
economy
is
heading
into
deflation,
BofA’s
chief
China
economist
Helen
Qiao
wrote
in
a
Tuesday
note.

Read
more
about
China
from
CNBC
Pro

“It
almost
appears
that when
major central
banks
find
it
hard
to tame
the
inflation
beast,
the
[People’s
Bank
of
China]
would
have
ranked
high
on
the
scorecard for inflation
control,”
she
wrote.

Qiao
added
that
China
has
managed
to
keep
its
consumer
price
index
inflation
rate
at
an
average
of
1.8%,
which
is
close
to
the
lowest
3-year
average
reading
since
2003.

Now,
China’s
core
CPI
inflation
is
already well
below
Japan’s
levels,
BofA
economists
noted. 

Though
not
yet
at
deflationary
levels,
China’s
low
inflation
is
likely
driven
by
insufficient
demand.

“Households,
though
have
already
seen
a
notable
pent-up
demand
from
tourism
during the recent
holidays,
are
still
cautious
on
goods
spending,
especially for
large
ticket
items
(white
goods,
autos
etc.,),”
Qiao
wrote
in
the
note.

“The
weak
labor
market
as
well
as
the
slower
recovery
in
the
property
market
continued
to
weigh
on
consumer
sentiments,”
she
wrote.



CNBC’s
Lim
Hui
Jie
contributed
to
this
report



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