Consumer prices in China fell at their fastest rate in three years in November as pork prices crashed and consumer demand slumped.
Headline consumer prices fell by 0.5pc year-on-year in November, down from a 0.2pc fall in October and the lowest reading since November 2020, official data shows.
Food prices were the biggest drag, with pork prices falling by 31.8pc.
Factory-gate prices fell by 3pc year-on-year, down from a 2.6pc drop in October and below the consensus expectation of a 2.8pc fall. This was the fourteenth month in a row that producer prices fell.
Manufactured goods prices fell by 3.1pc. Duncan Wrigley, chief China economist at Pantheon Macroeconomics, said: “Export demand has fallen this year, while domestic demand has failed to make up the difference.”
China’s stock market bounced on Monday afternoon, more than wiping out losses in early trading as investors bet on new government policy support.
The CSI 300 closed 0.6pc higher, while the Shanghai Composite Index was up 0.7pc.
Mr Wrigley said: “China probably will continue to channel fiscal stimulus though infrastructure and manufacturing investment, trusting this to spillover into domestic demand, and hence jobs and ultimately consumption.”
