Core Viewpoint - In July, the "anti-involution" policy led to a reduction in the decline of PPI, which fell by 0.2% month-on-month, driven by key industries controlling volume and raising prices [1] Group 1: PPI and CPI Analysis - The PPI year-on-year decline remains at a two-year low of -3.6%, while CPI has shifted from an increase to stability [1] - The improvement in industrial consumer prices, along with the rise in gold prices and the fading of promotional disturbances, has contributed to the recovery of core CPI for the third consecutive month [1] Group 2: Future Outlook - The easing of tailing factors may lead to improvements in PPI year-on-year and CPI year-on-year in the fourth quarter, starting from August [1] - To effectively drive inflation back to historical averages, stronger policy measures and a focus on expanding domestic demand are essential [1]

Core Insights - In July, the "anti-involution" policy led to a reduction in the month-on-month decline of the Producer Price Index (PPI) to -0.2%, driven by key industries controlling volume and raising prices [1] - The Consumer Price Index (CPI) for industrial consumer goods improved due to the release of new funds, the fading of online promotional disturbances, and rising gold prices, resulting in the core CPI increasing for the third consecutive month year-on-year [1] - The current supply-side capacity governance is more market-oriented and rule-based compared to 2016, leading to a milder effect on price increases [1] PPI and CPI Analysis - The year-on-year decline of PPI remains at a two-year low of -3.6%, while the CPI has shifted from an increase to stability [1] - Looking ahead, the fading of tailing factors may lead to improvements in year-on-year PPI and CPI in the fourth quarter, starting from August [1] - To effectively drive inflation back to historical averages, stronger policy measures and a focus on expanding domestic demand are essential [1]