Is Chinese producer price deflation finally abating?
BOFIT Viikkokatsaus / BOFIT Weekly Review
2016/15
March consumer price inflation was unchanged from February at 2.3 % y-o-y. Core inflation (excluding food and energy prices) accelerated slightly to 1.5 %. A visible shift, however, seems to be occurring in the producer price trend. Producer prices were down nearly 6 % y-o-y at the end of last year, but down only 4.3 % in March. Moreover, while the on-year price change was still negative, producer prices in March rose from February. It was the first time an on-month rise had been seen since September 2013. If the new trend becomes established, it may dissipate many policy concerns related to the deflationary trend even at the global level.
