India's Consumer Price Index (CPI) inflation for FY26 is expected to remain at 2.2 per cent, much lower than the Reserve Bank of India's (RBI) forecast of 2.6 per cent, according to a report by the State Bank of India (SBI). The report highlighted that the sharp moderation in inflation has been mainly driven by a decline in food and beverage prices.It stated, "We expect average CPI inflation for FY26 to be now at 2.2 per cent, much lower than 2.6 per cent RBI forecast." According to the report, India's CPI ...

The Dow Jones Industrials ( DJI ) Index closed above 46000 for the first time, and that's on the day when the CPI inflation increased by 0.4% MoM, with the core CPI at 3.1%, and at the same the initialAnalyst’s Disclosure:I/we have a beneficial short position in the shares of SPX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship w ...

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the Chinese economy, specifically analyzing the Consumer Price Index (CPI) and Producer Price Index (PPI) trends for August 2023. Core Insights 1. **CPI Trends**: - China's headline CPI fell to -0.4% year-over-year (yoy) in August from 0.0% yoy in July, indicating a significant shift towards deflation primarily driven by food prices [1][4] - Month-on-month, the CPI decreased to -0.3% (annualized, seasonally adjusted) in August compared to +0.4% in July [4] 2. **Food Inflation**: - Food inflation dropped to -4.3% yoy in August from -1.6% yoy in July, with pork prices falling by 16.1% yoy, fresh vegetables by 15.2% yoy, and fresh fruits by 3.7% yoy [5][9] - The decline in food prices is attributed to high base prices from the previous year and increased supply in response to elevated prices in the second half of 2024 [5] 3. **Non-Food Inflation**: - Non-food CPI inflation increased to +0.5% yoy in August from +0.3% yoy in July, with both services and non-food goods inflation accelerating [10] - Energy price deflation eased, with fuel costs decreasing by 7.1% yoy in August compared to -9.0% yoy in July [10] 4. **PPI Trends**: - Year-over-year PPI inflation improved to -2.9% yoy in August from -3.6% yoy in July, indicating a lessening of deflation in upstream sectors [11] - Month-over-month, PPI inflation rose to +1.1% (annualized, seasonally adjusted) in August from -1.4% in July [11] 5. **Sector Contributions**: - The improvement in PPI was broad-based, with ferrous metals contributing significantly to the higher PPI inflation [11] - PPI inflation in producer goods rose to -3.2% yoy in August from -4.3% yoy in July, while consumer goods PPI inflation edged down to -1.7% yoy [11] Additional Important Points - The report emphasizes the impact of policy efforts aimed at boosting domestic demand, such as consumer trade-in programs, which have contributed to the rise in durable goods prices [10] - Core CPI inflation, excluding food and energy, edged up to +0.9% yoy in August from +0.8% in July, indicating a slight increase in underlying inflation pressures [10] This summary encapsulates the key findings and trends in the Chinese economy as reflected in the CPI and PPI data for August 2023, highlighting the significant deflationary pressures in food prices and the gradual easing of PPI deflation.

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the **Chinese economy**, particularly its inflation dynamics and the impact of anti-involution measures on economic conditions [1][4][5]. Core Insights and Arguments - **CPI and PPI Trends**: - July's **CPI** showed flat growth at **0%** year-on-year (YoY), down from **0.1%** in June, with food prices dropping **1.6%** YoY [1][4]. - **PPI** experienced a decline of **0.2%** month-on-month (MoM), maintaining an elevated YoY rate of **3.6%** [2][4]. - Consumer goods PPI fell **1.6%** YoY, while producer goods PPI dropped **4.3%** [2]. - **Contributing Factors**: - The decline in CPI was offset by increases in household facilities/services (+0.4% MoM), transportation and communication (+0.2%), and education and entertainment (+0.1%) [1][4]. - Seasonal factors, such as summer tourism and trade-in policy support, contributed to these increases [1][4]. - **Inflation Expectations**: - CPI inflation is expected to hover around **0%** in the coming months, with gradual narrowing of PPI deflation anticipated [4][6]. - **Anti-involution Measures**: - The government's anti-involution measures have led to a marginal narrowing in PPI deflation in affected sectors like coal and steel, but overall impact remains modest [5][6]. - The imbalance between domestic supply and demand persists, limiting significant inflationary pressure [6]. Additional Important Insights - **Sector-Specific Impacts**: - The report highlights that while trade-in subsidies have provided some support, they are insufficient to significantly alter the inflation landscape [6]. - Household appliance CPI inflation turned positive in June, reaching **2.8%** YoY in July, but PPI for these goods remained in deflation [6]. - **Market Sentiment**: - There is a cautious optimism regarding the government's ability to manage excess capacity and unemployment while implementing reforms [5][6]. - **Future Projections**: - The report anticipates only modest progress in reducing excess capacity and a gradual improvement in domestic inflation conditions [6]. This summary encapsulates the key points discussed in the conference call regarding the current state of the Chinese economy, inflation trends, and the implications of government policies.

Investment Rating - The report revises down the full-year 2025/26 forecast of headline PPI inflation to -2.4%/-0.7% yoy from -2.1%/-0.6% yoy previously, indicating a bearish outlook on the industry [10]. Core Insights - China's headline CPI inflation remained unchanged at -0.1% yoy in May, with a decline in goods prices offset by higher services prices [1][3]. - Headline PPI inflation fell to -3.3% yoy in May, down from -2.7% yoy in April, primarily due to falling commodity prices [1][9]. - The report indicates that the weak PPI data suggests more deflationary pressures on China's PPI inflation for 2025 and 2026 than previously anticipated [10]. Summary by Sections CPI Analysis - In May, the CPI was -0.1% yoy, with a month-on-month increase of +0.5% (annualized, seasonally adjusted) [2][3]. - Food inflation decreased to -0.4% yoy in May, primarily due to lower prices of fresh vegetables, while pork prices rose by 3.1% yoy [4]. - Non-food CPI inflation was flat at 0% yoy, with fuel costs falling by 12.9% yoy [5][7]. PPI Analysis - Year-over-year PPI inflation fell to -3.3% yoy in May, with deeper deflation mainly from price declines in upstream sectors like energy and metals [9]. - Month-over-month PPI inflation declined to -5.1% (annualized, seasonally adjusted) in May [9]. - PPI inflation in producer goods fell to -4.0% yoy in May, while consumer goods edged up to -1.4% yoy [9]. Forecast Revisions - The report incorporates weak PPI data, leading to a downward revision of the full-year 2025/26 forecast of headline PPI inflation to -2.4%/-0.7% yoy [10].