Coming to an economy near you in 2023. Pantheon with the note.
In a global economy suffering from high inflation, China’s CPI disinflationary trend is symptomatic of weak domestic demand and labour market slack, which in turn are rooted in the property sector’s malaise and the “unswerving” adherence to zero-Covid policy. China’s measures to boost coal supply helped to manage energy CPI inflation, which we estimate slowed to 5.3% y/y in October, from 10.9% in September. Core CPI inflation was unchanged at 0.6% y/y in October, while services prices slowed to 0.4% from 0.5%, a barometer of the impact of pandemic measures on consumption demand.
Food prices continued rapid rises, on the back of rocketing pork prices, though tempered by seasonal factors. Food prices rose 7.0% in October, down from 8.8% in September, while pork prices increased 51.8%, up from 36%. Other food prices slowed because of a drop in consumer demand after the National Day holiday in early October. Fresh vegetable prices fell 8.1% in October, after rising 12.1% in September.
