China’s Producer Price Inflation Falls 4.6 Percent in May Amid Overall Deflation Risk

China’s Producer Price Inflation Falls 4.6 Percent in May Amid Overall Deflation Risk
People walk past a Subway sandwich store at Sanlitun Soho residential and commercial complex in Beijing, China, on June 28, 2018. Jason Lee/Reuters
Naveen Athrappully
Updated:

China’s Producer Price Index (PPI) fell for the eighth straight month in May, fortifying concerns about the economy slipping into a deflationary situation.

Data from China’s National Bureau of Statistics show that the country’s PPI for May declined by 4.6 percent year over year, according to Reuters. This is the eighth consecutive monthly decline and the fastest fall since February 2016. PPI measures inflation from the viewpoint of producers. This is in contrast to the Consumer Price Index (CPI), which measures inflation from the viewpoint of consumers. The continuous decline in PPI has some experts worried about the possibility of deflation.

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