July 9, 2025 04:00 AM GMT China Economics | Asia Pacific PPI Deflation Deepens Key Takeaways Stable core CPI, less drag from food and energy: Core CPI edged up 0.1ppt to 0.7%Y from a low base, while its MoM growth held steady at 1.1% SAAR (on par with April and May), thanks to consumer subsidies (CPI factor in undiscounted prices). Meanwhile, food prices came in strong at 12%M SAAR amid unfavorable weather (per NBS), and oil CPI rebounded 5%M SAAR (vs. sharp drop in previous months). PPI - weak final demand ...

(*seasonally adjusted by GS) Main points: 1. China's headline CPI inflation was unchanged at -0.1% yoy in May, as the decline in goods prices was offset by higher services prices (Exhibit 1). In month-on-month terms, headline CPI fell to +0.5% (annualized, seasonally adjusted) in May (vs. +0.8% mom s.a. ann in April). 2. In year-over-year terms, food inflation edged down to -0.4% yoy in May from -0.2% yoy in April. This is primarily due to lower prices of fresh vegetables (Exhibit 2). Among major food items ...