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Chinese inflation slows to a 29-month low of 2.2% in June vs. 3% in May and expectations of...

Chinese inflation slows to a 29-month low of 2.2% in June vs. 3% in May and expectations of 2.3%. Even more striking, the CPI fell 0.6% during June - the 3rd consecutive monthly negative print. Beijing certainly has more room to ease policy further, should it wish to. Shanghai -0.5% and Hong Kong -0.4% on the back of declines in the West on Friday.
Comments (10)
  • Tom Guttenberger
    , contributor
    Comments (717) | Send Message
     
    Slowing money supply growth foreshadowing this one, no surprise here: http://bloom.bg/NewOiL

     

    I'll be waiting for the next unfounded article about bad loan growth and poor credit quality.
    8 Jul 2012, 10:47 PM Reply Like
  • SanDiegoNonSurfer
    , contributor
    Comments (3403) | Send Message
     
    PBC lowered the reserve requirement back in May. If that didn't stimulate growth in the money supply, lending is drying up.

     

    http://bloom.bg/KSXlTS
    9 Jul 2012, 08:49 AM Reply Like
  • untrusting investor
    , contributor
    Comments (9973) | Send Message
     
    Might slowing Chinese inflation have anything to do with the strengthening dollar and the yuan peg. Stronger dollar and lower commodity prices means less inflation.
    8 Jul 2012, 10:53 PM Reply Like
  • Tom Guttenberger
    , contributor
    Comments (717) | Send Message
     
    Absolutely. It hits the PPI even harder, look at -2.1% YOY.
    8 Jul 2012, 11:00 PM Reply Like
  • GaltMachine
    , contributor
    Comments (1250) | Send Message
     
    The inverted Chinese curve last year really was signalling bad news for their economy.
    8 Jul 2012, 11:11 PM Reply Like
  • Whitehawk
    , contributor
    Comments (3129) | Send Message
     
    I'd like to see the hedonic adjustments on this...not buying it.
    8 Jul 2012, 11:41 PM Reply Like
  • Tom Guttenberger
    , contributor
    Comments (717) | Send Message
     
    There have been some pretty interesting discrepancies between the CPI and GDP deflator...my interpretation is that the Chinese are generally buying better goods, but obviously could be a 'goods basket' overcorrection issue...not sure, interesting topic.
    9 Jul 2012, 08:35 AM Reply Like
  • SanDiegoNonSurfer
    , contributor
    Comments (3403) | Send Message
     
    Whitehawk, is that really so surprising given that prices for most commodities (oil, steel, coal, e.g.) are falling?
    9 Jul 2012, 08:50 AM Reply Like
  • Jason Tillberg
    , contributor
    Comments (1267) | Send Message
     
    Normal growing pains. Regardless, China has won. I think you can ask 100 Chinese in China if they are better off today than they were 10 years ago and 95 will say yes.
    9 Jul 2012, 09:27 AM Reply Like
  • Forex Novice
    , contributor
    Comments (19) | Send Message
     
    I think that the falling CPI hints at a slowing down of the Chinese economy. Perhaps the more relevant question would be is there going to be a soft or hard landing? In my opinion, the falling aud is a reflection of the perceived fall of the Chinese Economy.
    9 Jul 2012, 09:56 AM Reply Like
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