China’s Inflation Problem Isn’t Just Going Away

China has taken an important symbolic step toward addressing a persistent drag on its economy. Much attention has been focused on the cost that US President Donald Trump’s tariffs will inflict, the mounting toll of a real-estate crisis, and even the long-term impact of a shrinking labor market. It has been easy to forget that Beijing has an inflation problem.

Not the surging — and now receding — prices that just about every other economy has wrestled with. Instead, Beijing is haunted by the specter of deflation. Premier Li Qiang told legislators gathered Wednesday at the National People’s Congress that he will target inflation of 2% this year, the lowest level in more than two decades. That might not sound like a big breakthrough, given most countries aim for something in that vicinity, and Li’s ambitions to boost government and consumer spending. But the first stage in solving any problem is acknowledging there is an issue in the first place.