Falling Chinese inflation is the growth canary

Monday, 12 February 2018

Friday saw the release of Chinese inflation which is cooling fast as the CPI slumped to 1.5% and PPL to 4.3%:

As said before, the PPI is the key. It is an excellent leading indicator for Chinese industrial growth. I expect it to return to deflation in H2 as the commodities complex – especially ferrous – deflates.

Capital Economics has more:

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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.