Link Securities | According to official data, China’s consumer price index (CPI) fell 0.3% year-on-year in September, a deeper decline than the 0.1% consensus forecast by analysts, although slightly lower than the 0.4% decline in the previous month. Food prices accelerated their decline (a drop of 4.4% against 4.3% in August), recording the largest contraction since January 2024, amid widespread declines across all categories, with pork prices falling further due to advance supply ahead of the Golden Week holidays, lower production prices and weak demand.In contrast, non-food inflation accelerated (0.7% against 0.5% in August), supported by current consumer exchange schemes to boost demand, with the largest increases in housing (0.1% against 0.1% in August); clothing (1.7% against 1.8% in August); health (1.1% against 0.9% in August); and education (0.8% against 1.0% in August).
Meanwhile, transport prices fell at a slower pace (down 2.0% against 2.4% in August). Core inflation, which excludes unprocessed food and energy prices, rose 1.0% year-on-year in September, its biggest jump in 19 months, following a 0.9% increase in August.
In monthly terms, China’s CPI rose 0.1% in September, falling short of market expectations of a 0.2% increase, after remaining flat in August.
