| Actual | Previous | Consensus | Consensus Range | |
|---|---|---|---|---|
| Month over Month | 0.4% | -0.1% | ||
| Year over Year | 0.0% | 0.1% | -0.1% | -0.1% to -0.1% |
Highlights
China's headline consumer price index was unchanged on the year in July, easing from an increase of 0.1 percent in June, and rose 0.4 percent on the month after dropping 0.1 percent previously. Food prices fell 1.6 percent on the year after dropping 0.3 percent previously, but this was offset by price increases for non-food items, with core inflation increasing slightly from 0.7 percent to 0.8 percent. This is the strongest core inflation since March 2024. Producer price inflation data also published today showed ongoing weakness in price pressures.
Market Consensus Before Announcement
China's consumer prices are widely expected to slip back into slight deflation in July, down 0.1% on the year, after popping up above zero in June with a 0.1% gain, which was the first y/y increase in four months. The world's second-largest economy has been struggling to drag itself out of the pandemic doldrums caused by property market problems and cautious households.
Definition
Consumer Price Index (CPI) is an index that measures changes over time in the price level of consumer goods and services purchased by residents, which reflects the overall changes in price level.
Description
Consumer prices account for a majority of overall inflation, which is carefully monitored by investors worldwide. Investors worldwide monitor Chinese price changes closely. A pickup in inflation could mean an increase in interest rates is in the offing from the People's Bank of China while an easing could mean looser monetary policy. The monthly CPI is broken down by 8 categories with more detail available on the following day including aggregate information by urban and rural areas and provinces.
The CPI measures the change in the level of prices for a specified basket of goods and services normally purchased by urban and rural residents. Approximately 226 areas throughout the country are covered, including 80 counties and 146 cities. The current CPI is an annually chained Laspeyres price index and has been available since 2001. From 1978 to 2000, the index was compiled using current year weights for most items.
The CPI measures the change in the level of prices for a specified basket of goods and services normally purchased by urban and rural residents. Approximately 226 areas throughout the country are covered, including 80 counties and 146 cities. The current CPI is an annually chained Laspeyres price index and has been available since 2001. From 1978 to 2000, the index was compiled using current year weights for most items.
