Consumer prices in China increased 4.2% year-on-year in November – the lowest inflation rate in 14 months – amid other indicators of a slowing economy that could lead Beijing to institute stimulus measures, Bloomberg reported. Industrial output grew the least since August 2009 at 12.4%, falling below analysts forecasts. The slowdown, compounded by concerns over the European sovereign debt crisis and a softening domestic property market, may shift Beijing’s focus to stimulating growth. “Curbing inflation is a good thing, but the reason why inflation is slowing is because the global economy is slowing,” said Koji Toda, chief fund manager at Resona Bank in Tokyo. Investors expect the renminbi appreciation to slow, as 12-month forwards fell 0.2% on Friday, suggesting a 0.8% decline against the dollar. Nomura estimates fourth-quarter growth to slow to 8.6% and decline further to 7.5% in the first quarter of 2012. China’s statistics bureau has forecasted 4% average inflation in 2012.
You must log in to post a comment.
Yes, I would like to receive emails from China Economic Review. (You can unsubscribe anytime)
Copyright © 2018 SinoMedia Group Limited All rights reserved