- ANZ
Consumer price index in the world's second biggest economy remained unchanged in October of this year. The inflation level stayed at the 1.6% on the annual basis and showed no movement month-on-month. The indicator was released in line with economists' expectations, but is at its lowest mark since January 2010. Meanwhile, producer prices in the country dropped 2.2% in October, more than a prediction of a 2% decline. At the same time, they point out that inflation below at least the 2% threshold is underlying the cooling growth of the whole economy, which may force CPI to drop even further and create deflation risks. It, in turn, raises hopes that Chinese authorities will introduce new measures to support the economy, which used to be the growth engine during past years. As predicted, the country's government is likely to inject funds into the system in coming months, but it will deny using extraordinary measures, such as interest cut, being that situation is far away from critical.
China's president, Xi Jinping, said on Sunday that the GDP growth of 7% can be considered as normal and it will be sufficient for the country to remain the leading expanding economy. Officially, the government targets the growth of 7.5% this year; however, the third quarter figures showed a slow-down to 7.2% and the downward trend may persist in the nearest future.
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