QuickTake
What Is Causing China’s Stubborn Deflation and When Will It End?
- Weak food demand biggest cause, as families tighten belts
- Many economists see return to soft inflation levels in 2024
The Datang district of Guangzhou, China.
Photographer: Qilai Shen/BloombergThis article is for subscribers only.
China’s slide into deflation is proving hard for the world’s second-largest economy to arrest. Economy-wide prices last quarter marked their longest deflationary streak since the Asian Financial Crisis in the late 1990s. Weak demand looks set to keep weighing on growth in 2024, posing another challenge for policymakers.
Here’s a look at how China’s deflation breaks down, and when it might come to an end: