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Chinese inflation slows on month, rises on year

  • Chinese inflation slowed in October to 0.1% on month from 0.8% in September and came in below consensus of 0.2%.
  • On year, though, a rise in food prices helped CPI increase to an eight-month high of +3.2% from +3.1%, but the metric still undershot forecasts of +3.3% and was within the government's 2013 target of +3.5%. While China's leaders have recently warned about inflation and the central bank has been tightening, UBS economist Wang Tao doesn't believe rising prices are "going to be a serious threat anytime soon."
  • China's producer price index dropped for the 20th month in a row, falling 1.5% vs -1.3% and -1.4%. The trend indicates softness in demand for raw materials and factory products, and suggests that China still very much has to contend with deflationary forces even as annual inflation rises.
  • The growth in industrial production increased to 10.3% on year from 10.2% and exceeded forecasts of 10%.
  • The rise in retail sales held steady at 13.3% but slightly missed predictions of 13.4%.
  • As expected, urban investment grew 20.1%, down from 20.2% a month earlier.
  • The data dump comes as Chinese leaders meet to discuss major economic reform.
  • ETFs - Stocks: FXI, GXC, PGJ, YAO, FCHI, PEK, CAF, YXI, XPP, FXP, MCHI, YINN, YANG, TCHI, CHXF, KFYP, HAO, ECNS. Bonds: DSUM, CHLC. Currency: CNY, CYB, FXCH
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Comments (1)
  • dunnhaupt
    , contributor
    Comments (719) | Send Message
     
    "Inflation edges up ...deflationary forces remain an issue". That kind of statement drove F.D. Roosevelt to wish for a one-armed economist who couldn't say "on the one hand -- on the other hand".
    11 Nov 2013, 08:06 AM Reply Like
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