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China’s inflation slightly rises but misses expectations
Weak inflation data sparks calls for stronger measures to boost household spending in China
China’s CPI rose 0.6%, missing expectations, while core CPI hit a 3-year low at 0.3%.
Producer prices fell 1.8% in August, marking the steepest decline in four months.
OPEC+ delayed an output increase, but it had little impact on oil prices; non-farm payroll data also weighed on markets.
China’s CPI
China’s broader CPI rose by 0.6% falling short of expectations (0.7%) despite being supported by higher food prices caused by adverse weather last month.
Core CPI, which excludes the volatile food and energy sectors, rose by just 0.3% in August compared to the previous year—the smallest increase since March 2021, according to the National Bureau of Statistics. Indicating that China's core inflation has dropped to its lowest point in over three years, fueling calls for stronger efforts to boost household spending as weak demand continues to strain the country's annual growth target.
On the same note, China's producer price index contracted for the 23rd consecutive month in August, shrinking at its fastest rate in four months with a year-on-year decline of 1.8%, surpassing the expected 1.4% drop. The decline also deepened from the 0.8% decrease recorded in July.
In Commodities
Oil prices remained under pressure but found some support with a potential hurricane approaching the Gulf Coast. Brent was trading around $71.60, while WTI hovered near $67.06.
The decision by OPEC+ to delay the output increase of 180,000 barrels per day starting in October provided little to no support for oil prices, while Friday's Non-farm payroll data also added pressure to the markets.
