China’s economy reports consumer deflation for the first time in 11 years

China’s consumer inflation entered negative territory in November for this first time since eleven years ago, recently released official data showed.

China’s official consumer price index fell to minus 0.5 percent in November from a year earlier, from 0.5 percent growth in October, according to the country’s National Bureau of Statistics.

This was the lowest since it also reached minus 0.5 percent in October 2009.This was below the median expectations of a Bloomberg survey of several analysts, which forecast a fall to zero percent.

The fall was led by a 2.2 percent decline in the overall price of food, which included the price of pork products falling by 12 percent. The price of eggs also fell 17 percent.

Capital Economics said, “This was almost entirely driven by improvements in pork supply and isn’t evidence of faltering demand. To the contrary, broader price pressures are starting to pick up on the back of the improvement in economic activity.”

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