China Consumption Slump Deepens As February Prices Drop
China's consumer prices dropped for the first time since January 2024, falling 0.7 percent year-on-year in February, as authorities struggle to kickstart spending amid a pandemic-induced slump in domestic consumption.The country's key measure of inflation declined more sharply than forecast, reversing the uptick recorded in January when Lunar New Year festivities boosted inflation. The steep decline is attributed to various factors including the shift in lunar new year celebrations, holidays, and price fluctuations of international staple commodities.According to Dong Lijuan of the National Bureau of Statistics, the drop was primarily caused by these seasonal adjustments.
- This decline could signal a more pronounced impact on China's economic growth as domestic consumption remains under strain from the pandemic.
- How will China's efforts to stimulate consumer spending through targeted policies and monetary easing affect its ability to sustain long-term economic recovery?