Chinese economy expected to have slipped into deflation as recovery falters

News Snapshot:

The Chinese economy is expected to have slipped into deflation amid signs of a faltering post-pandemic recovery, according to market forecasters. Chinese consumer price inflation data is due to be released on Wednesday, and a Reuters poll of economists suggests it will show that prices fell by 0.4% year-on-year in July, having been flat on an annual basis in June. That would be China’s first negative inflation reading since early 2021, when prices were weaker as the Covid-19 pandemic hit demand, and pork prices fell. Chinese retailers have been hit by a slowdown in sales this summer. This means retailers...