•  vegai   ( @vegai@suppo.fi ) OP
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      1 year ago

      Their deflation is way smaller than the inflation in the west, at least right now. Plus the west is at least attempting to decouple from chinese manufacturing which is bound to make things more, not less, expensive. Thirdly, changes like this reflect on consumer prices slowly. And fourthly, corporations will just pocket the difference if nothing (usually competition) stops them from doing so.

  • This is the best summary I could come up with:


    The Chinese economy is expected to have slipped into deflation amid signs of a faltering post-pandemic recovery, according to market forecasters.

    This means retailers who stocked up on goods expecting a surge in demand after pandemic restrictions were lifted are now under pressure to cut prices.

    Homin Lee, senior macro strategist at Lombard Odier, predicted July’s CPI inflation report could show “outright deflation”, with prices slightly lower than a year ago.

    In the UK, consumer prices were 7.9% higher than a year ago in June, as households suffered a long run of falling real incomes.

    Trade data released on Tuesday showed that China’s imports and exports both fell more sharply than expected in July, adding to concerns over the world’s second-largest economy.

    Jim Reid, strategist at Deutsche Bank, said the trade data highlighted that the Chinese economy is being “dragged lower by weakness in global demand and a domestic slowdown”.


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