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China Cuts CPI Targets Amid Deepening Deflation Crisis

1/22/2025

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Summary

Story summary

China is grappling with ongoing deflation, driven by sluggish domestic demand and excess industrial capacity. In response, provinces have slashed their consumer price index targets to around 2% for 2025, a significant drop from 3%. This comes after a dismal 0.2% CPI growth last year, the lowest since 2009, as the central government seeks a gentle price rebound.

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Story summary

China is grappling with ongoing deflation, driven by sluggish domestic demand and excess industrial capacity. In response, provinces have slashed their consumer price index targets to around 2% for 2025, a significant drop from 3%. This comes after a dismal 0.2% CPI growth last year, the lowest since 2009, as the central government seeks a gentle price rebound.