China’s consumer inflation turned negative for the first time in 13 months, with CPI dropping 0.7% year-over-year in February due to falling food and alcoholic beverage prices. The reading missed forecasts, and the government has revised its inflation target and GDP growth expectation, indicating challenges ahead for domestic consumption.

In February, China’s Consumer Price Index (CPI) fell into negative territory for the first time in 13 months, primarily due to declines in prices for food, tobacco, and alcohol. This decrease of 0.7% compared to the previous year contrasts with a 0.5% gain observed in January. Analysts had expected an annual contraction of only 0.5%, indicating a larger-than-anticipated drop.

The recent data highlights the challenges faced by China’s economy as it attempts to achieve its targeted 5% GDP growth for 2025 amid weak domestic consumption and international trade tensions. The revised inflation goal seeks to stabilize economic conditions without creating excessive inflation, which could hinder growth further. It remains to be seen how effective governmental stimulus measures will be in fostering recovery.

Original Source: www.cnbc.com

Related posts:

China’s Consumer Inflation Falls Below Zero, Signaling Deflationary Concerns China’s Consumer Prices Decline Amid Sluggish Economy Consumer Prices in China Decline for First Time in 13 Months Amid Economic Concerns China’s Economic Strategies Ahead of Key Parliamentary Meetings: Yuan Stability Postured