China CPI ticks higher in January
By Michele Maatouk
Date: Friday 10 Feb 2023
(Sharecast News) - Consumer price inflation in China ticked up in January as the country reopened after more than two years of Covid restrictions, according to figures released on Friday by the National Bureau of Statistics.
CPI rose 2.1% on the year in January, up from 1.8% in December and in line with expectations, as China celebrated the lunar new year.
Meanwhile, the producer price index fell 0.8% year-over-year in January following a 0.7% decline the month before. Analysts had been expecting a 0.5% drop.
Duncan Wrigley, chief China+ economist at Pantheon Macroeconomics, said: "The People's Bank of China no doubt will continue to take the view that China's inflation is fundamentally under control.
"The inflationary effect of domestic demand expansion should be offset by weak export demand and production capacity expansion. The Bank will likely take the opportunity to boost private sector credit demand through symbolic benchmark rate cuts in the next month or two.
"The recent renminbi appreciation against a weak dollar since November should ease the pressure of continued negative yield spreads for Chinese government bonds over US Treasuries."
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