China’s consumer price inflation accelerated in July to the highest level in two years amid surging pork costs, but missed economists’ expectations for hotter growth.
China shares faltered on Wednesday as traders evaluated inflation rising to its highest level in two years amid surging pork costs. Weaker demand limited overall price pressures in the world’s second-largest economy.ahead of the release due late Wednesday AEST.Hong Kong’s Hang Seng Index fell 2.2 per cent to 19,559.33 ahead of the closing bell in Sydney, while China’s Shanghai Composite Index fell 0.6 per cent to 3227.98.
Meanwhile, the producer price index, a measure of the average movements of prices received by domestic producers, increased to 4.2 per cent, below the forecast of 4.9 per cent and lower than the 6.1 per cent print in June. “We expect China’s CPI to rise further as local pork prices will face the start of a new upward cycle, to run from 2022 to 2024,” senior China strategist Zhaopeng Xing said.
ANZ says China’s strategic reserves will help manage inflation back to 2.2 per cent in 2023 with authorities estimated to have stockpiled over 1 billion kilos of pork and 926 barrels of oil.
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