Is China’s inflation rebound losing steam?

Is China’s inflation rebound losing steam?

Data released on Monday showed that China’s inflation steadied in June, raising questions whether the latest rebound is losing steam.

The graph shows that the China’s producer prices index has formed a peak, while the CPI index is steadying after rebound.

PPI soared 5.5 percent in the year through June, similar to analysts’ forecasts, after climbing to 7.8 percent four months earlier.

CPI for the same period rose 1.5 percent, compared to projections of 1.6 percent surge.

Meanwhile, there are concerns that global inflation is heading to a slowdown, which would yield in deceleration in the growth pace.

Unlike retreats in inflation in U.S., euro area and Japan, strong demand helped China’s PPI to remain steady.

However, some economists predict PPI to end the year at weaker pace of 5.3 percent and to slow more in 2018 to 2 percent due to lower commodity prices and regulatory curbs

As of 08:16 GMT, the dollar was 0.04 percent lower versus the Chinese yuan, as the USDCNY traded at 6.8030.

Ahmed Mamdouh

Ahmed Mamdouh, Co-Founder and Head of English Fundamental Analysis at FXComment.com, with 7 years of experience in the financial markets. Mamdouh holds a Master’s Degree in Economics from The American University in Cairo and a Bachelor Degree in Economics from The Faculty of Economics and Political Science, Cairo University.

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