China consumer prices rise at slower rate in November

China's consumer price index (CPI) rose 0.2% in November year on year, down from 0.3% in October. Photo / 123RF

China’s consumer inflation rate slowed in November, official data showed on Monday, as demand remains muted in the world’s number two economy.

The country is battling sluggish domestic consumption, a persistent crisis in the property sector and soaring government debt - all of which threaten Beijing’s official growth target for this year.

The consumer price index (CPI), a key measure of inflation, rose 0.2% in November year-on-year, down from 0.3% in October, the National Bureau of Statistics said.

That was below the 0.4% forecast in a Bloomberg survey of economists.

Beijing has announced in recent months a slew of its most aggressive measures in years aimed at boosting growth in China, which has struggled to fully recover since the Covid-19 pandemic.

Many major Western economies have been grappling with the threat of high inflation but China has instead been battling low or negative prices.

China sank into deflation for four months at the end of 2023, with the sharpest contraction in consumer prices in 14 years in January.

Factory gate prices also slid 2.5% year-on-year in November, compared to a decrease of 2.9% in October, the bureau said on Monday.

That extends a deflationary run that began in late 2022.

Beijing has unveiled a string of measures since September aimed at bolstering growth, including cutting interest rates, cancelling restrictions on homebuying, and easing the debt burden on local governments.

However, economists have warned that more direct fiscal stimulus aimed at shoring up domestic consumption is needed to restore full health in China’s economy.

“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.

© Agence France-Presse