China Consumer Prices are descending again, deepening deflation’s worries as demand remains weak

Chinese consumer prices fell for the fourth consecutive month in May, as Beijing measures to stimulate It seems insufficient to increase domestic consumption while the trade voltage is simmering.

The consumer prices index fell 0.1% compared to a year earlier, according to Data from the National Statistics Bureau published on MondayCompared to the average estimate of a 0.2% drop in Reuters surveyed.

Cpi Slid into negative territory In February, it fell by 0.7% compared to a year ago and continued after a year of 0.1% in March and April.

Separate deflation in the prices of the factory or the country’s manufacturers deepened, falling by 3.3% of one year In May, in May, the expectations of analysts for a decrease of 3.2%. Wholesale prices have remained in a deflationary territory since October 2022, according to LSEG data.

On May 7, Chinese best financial regulators unleashed the noise of political steps aimed at strengthening the country’s tariff economy. China’s central bank cut Basic interest rates with 10 basic points to historically low levels and reduce the ratio of the reserve requirement, which determines the amount of cash banks they have to keep in the reserves with 50 basic points.

US President Donald Trump has strengthened the tariffs for Chinese goods to a 145%prohibition level, which led Beijing to avenge obligations and other restrictive measures, such as the control of exports of his critical minerals.

On May 12, the economy was relieved after the US and China reached a preliminary deal in Geneva, Switzerland, which made both sides drop the bigger part of the tariffs. Washington reduced their levies on Chinese goods to 51.1%, while Beijing dropped taxes on US imports to 32.6%, according to Think Tank Institute of International Economics of PetersonAllowing some space for both parties to negotiate a wider deal.

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