The prices of the factory portal in China decreased at the fastest pace in six months in April, while consumers decreased for a third month in a row, enhancing fears of weak domestic demand and high pressure on additional economic stimulation.
The data issued by the National Bureau of Statistics showed that the PPI price index decreased by 2.7 % on an annual basis in April, which is more severe than declining by 2.5 % registered in March but slightly better than the economy expectations by 2.8 %.
Consumer prices (CPI) also decreased by 0.1 % from the previous year, as the decrease in March decreases and align with expectations. On a monthly basis, the consumer price index increased by 0.1 % in April, recovering from a 0.4 % decrease in March.
The basic enlargement – which excludes the prices of flying food and fuel – was coded by 0.5 %, as in March.
“The pressure pressure is still fixed,” said Zeoye Zhang, chief economist at Pinpoint Asset Management. “Exports are likely to weaken in the coming months, which may exacerbate the situation. Even with trade talks between China and the United States, the unlikely definitions will return to pre -April levels. A more aggressive financial procedure is needed.”
China is competing with a mixture of internal and external challenges: the decline in the long real estate market, the high home debts, and the poor job security, all of which are still in suppressing spending and investment. The ongoing trade war with the United States adds more pressure, although a new round of bilateral negotiations begins on Saturday in Switzerland, which raises hopes for some escalation.
To counter these opposite winds, the Chinese authorities announced discounts in interest rates, achieved additional liquidity, and have been promoting wider consumption.
Meanwhile, major local retailers such as JD.com and Alibaba’s Freshippo help to turn into the local market, although analysts warn that this axis may increase price competition and increase confidence.
Global banks such as Goldman Sachs have already reduced the 2025 GDP growth forecast in China less than the 5 % goal of the government, noting losses of long commercial frictions and weakening global demand.
