China inflation rings warning bell

Wednesday, 10 December 2014

China’s December inflation numbers are out and the news is more weakness with the CPI year on year at 1.4% versus 1.6% expected and the PPI year on year at -2.7% versus 2.4% expected:

The PPI is a real worry. Producer price deflation has telegraphed every mini-cycle of industrial weakness since 2011. Even with all of its stimulus to date, the current round is not over. China is struggling.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.