Thursday, March 9, 2017

Reflation Continued But PPI May Have Peaked

Economic Research
09 March 2017
China

Economic Update




China’s CPI came in much lower than market’s expectations in February, due to distortion from the Lunar New Year effect. However, PPI recorded in excess of an 8-year high, given rising commodity prices and a relatively low base of comparison. Looking ahead, we believe CPI would recover on the back of rising non-food inflation and a diminishing high base effect, while PPI could have already peaked in Feb/Mar 2017, and may head south in the remaining months of the year. For policy makers, we believe they would likely focus more on risk controls and measures to lower leverage at financial institutions. Along with a prudent monetary stance, we believe the risk for liquidity would be on the upside in the coming months.


Economist:  Zhang Fan| +8621 6288 9611 ext 105



To access our recent reports please click on the links below:


No comments:

Post a Comment

Note: Only a member of this blog may post a comment.

Related Posts with Thumbnails