China’s consumer inflation rate decreased in November, according to government statistics released Monday, as the world’s second-largest economy continues to see low demand.
The nation is struggling with low domestic demand, a lingering real estate crisis, and skyrocketing public debt, all of which pose a threat to Beijing’s stated growth goal for this year.
A key indicator of inflation, the consumer price index (CPI), increased by 0.2 percent in November compared to 0.3 percent in October, according to the National Bureau of Statistics (NBS).
That was below the 0.4 percent forecast in a Bloomberg survey of economists.
In an effort to accelerate China’s growth, which has been hampered by the Covid-19 pandemic, Beijing has unveiled a number of its most aggressive policies in recent months.
China has been fighting low or negative pricing, while many major Western economies have been confronting the possibility of excessive inflation.
At the end of 2023, China saw four months of deflation, with January seeing the worst drop in consumer prices in 14 years.
According to the NBS on Monday, factory gate prices fell 2.5 percent year over year in November after falling 2.9 percent in October.
This prolongs a period of deflation that started in late 2022.
Since September, Beijing has announced a number of policies to boost growth, including as lowering borrowing rates, lifting homebuying restrictions, and relieving local governments of some of their debt.
Economists caution that in order to fully revive China’s economy, more direct fiscal stimulus targeted at boosting domestic consumption is required.
“Economic activities stabilised recently but the recovery is not strong enough to boost inflation yet,” Zhiwei Zhang, chief economist at Pinpoint Asset Management, said in a note.
“It requires a much stronger fiscal push to get China out of the deflationary environment,” he said.
