Core Viewpoint - The article discusses the recent changes in the Consumer Price Index (CPI) in China, highlighting a shift from negative to positive growth in June, driven by various economic factors and policy measures [1][2]. Group 1: CPI Trends - In June, the CPI increased by 0.1% year-on-year, ending a four-month streak of negative growth, with the core CPI reaching a new high in nearly 14 months [1]. - The decline in CPI earlier in the year was significantly influenced by food prices, which fell by 0.9%, and energy prices, which decreased by 3.2%, collectively pulling down the CPI by approximately 0.4 percentage points [2]. Group 2: Factors Supporting Price Recovery - Several factors are expected to support a moderate recovery in prices in the second half of the year: 1. The economy is maintaining a stable and positive trend, with continued expansion in total demand, providing a macroeconomic foundation for price stability [3]. 2. Policies aimed at expanding domestic demand are expected to effectively stimulate consumption and support a rebound in consumer prices [3]. 3. Regulatory measures to address low-price disorder in the market will help improve market order and environment [4]. 4. The holiday effect is anticipated to promote stability or an increase in service-related prices [4]. 5. Technical factors indicate that the downward pressure from tail effects on both CPI and PPI will diminish in the second half of the year [4].

Group 1 - The overall price level is still adjusting due to the pressure from traditional growth drivers, despite the emergence of new growth drivers [1][3] - In June, the Consumer Price Index (CPI) rose by 0.1% year-on-year, ending four consecutive months of negative growth, while the core CPI reached a new high in nearly 14 months [1][3] - Factors supporting a moderate recovery in prices in the second half of the year include stable economic performance, effective demand expansion policies, regulation of low-price competition, holiday effects, and diminishing tail effects [1][4] Group 2 - The rise in CPI in June was influenced by the recovery of industrial consumer goods prices supported by "two new" policies, as well as supply disruptions in vegetables and certain seafood products due to weather conditions [3] - In the first half of the year, food prices fell by 0.9% and energy prices decreased by 3.2%, collectively dragging down the CPI by approximately 0.4 percentage points [3] - The current low price levels are characterized by structural and temporary factors, linked to both domestic and international macroeconomic changes [3][4] Group 3 - The expectation for price trends in the second half of the year is a low and moderate recovery, supported by several factors including stable economic growth and expanding overall demand [4] - Policies aimed at expanding domestic demand are expected to effectively stimulate consumption and support price recovery in consumer goods [4] - Recent self-regulatory actions by industry associations in sectors like photovoltaics, cement, and automobiles are anticipated to positively impact pricing in those areas [4]