Analysts at TD Securities note that China’s CPI rose 2.8% y/y in August, the same as the previous month, but above consensus and TD’s forecast of 2.7% y/y.
Key Quotes
“CPI rose 0.7% m/m, largely due to food prices which gained 3.2% m/m as pork prices rose sharply by 23.1% m/m. Other meat products also rose by 15% m/m. The only silver lining is that most other components of CPI were benign, with CPI ex-food up only 1.1% y/y, its lowest since May 2016. This is unlikely to stand in the way of further targeted easing by PBoC even though headline CPI is likely to rise still further given the persistent upward pressure on pork prices due to African Swine Flu.”
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