China Falls Short of Inflation Target

A rundown of the news making headlines in and around China:

Deflationary pressures remain: Official data on price levels showed that deflationary pressures continue to dog the Chinese economy. Last year, the consumer price index (CPI) grew only 0.2%, well below the government’s target of around 3%. In December, declining food prices caused the CPI to grow at a slower pace. The CPI grew by 0.1% year-on-year, with food prices falling by 0.5%. The core CPI, which excludes more-volatile food and energy prices, rose by 0.4% — a five-month high, but still relatively weak. Meanwhile, the producer price index, which measures prices of goods circulated among manufacturers and mining companies, fell by 2.3% year-on-year in December. The decline narrowed by 0.2 percentage points from November and marked the second consecutive month of improvement.