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Investing.com-- China’s consumer price index was largely unchanged in July, while producer prices fell more than expected amid sluggish domestic demand and persistent tariff risks.
CPI was flat year-on-year in July, government data showed on Saturday. The print compared with expectations for a 0.1% after a 0.1% rise seen in the prior month.
CPI rose 0.4% month-on-month, above expectations of a 0.3%.
The subdued headline number underscores persistent demand weakness in the broader economy. According to the National Bureau of Statistics, the combination of lower food costs and a high comparison base from the previous year contributed to the unchanged headline inflation.
Meanwhile, deflation lingered at the factory gate. The Producer Price Index (PPI) slipped 3.6% year-on-year in July, matching June’s near two-year low and exceeding economists’ projections of a 3.3% drop.
PPI inflation shrank for a 34th consecutive month and remained at its weakest level since July 2023.
Extreme weather and global trade headwinds, especially in construction and exports, weighed on prices, while the government’s measures to reduce overcapacity and curb unfair competition have so far done little to lift producer prices.