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        China's December CPI growth is expected to decline slightly from a year earlier


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Median Estimation Interval of Index December Estimation Number of Participating Forecasting Institutions in the same Period of Last Month
Consumer Price Index (CPI) 2.1 1.8~2.4 2.2 1.8 32
Industrial producer ex-factory price index (PPI) 1.61.2-3.7 2.7 4.9 29
Reuters'median forecast of about 30 institutions shows that China's CPI growth in December 2018 is expected to fall slightly to 2.1% year-on-year, mainly due to multiple oil price cuts, which greatly drags down non-food prices. Meanwhile, the expansion of commodity prices may lead to a sharp decline in December's PPI growth rate to 1.6% year-on-year, returning to the "1" era and creating the lowest level in more than two years.
The persistent downward pressure of the economy and the repeated emphasis of the central bank on "the unchanged orientation of sound monetary policy" mean that China's inflation has no upward momentum from both economic and financial aspects, and there is no need to worry about the risk of "stagflation". However, weakening demand is expected to drag down production and further drive down prices. Analysts believe that the warning may be warranted in the short term. Be wary of deflation.
Zhang Yu, chief macroeconomic analyst of Huachang securities, said in the report that the monthly average price of pork and vegetables is rising seasonally, but the price of pork is slightly less than the seasonal rule. At the same time, the epidemic of classical swine fever combined with cold winter weather, pork substitutes beef, mutton and chicken prices rose by 1.9%, 3.3% and 6.4% annually, respectively, while the price of eggs fell dramatically.


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