China: CPI to increase by a 1.6 percent clip year over year – Wells Fargo

Research Team at Wells Fargo, notes that the China’s consumer price index (CPI) increased by a smaller-than-expected 0.1 percent in August relative to July, weighed down by a sharp drop in food prices.

Key Quotes

“On a year-ago basis, consumer prices slowed from the 1.8 percent increase seen in July and advanced only 1.3 percent. However, the sizable drop in food prices is expected to be short-lived and markets look for CPI to increase by a 1.6 percent clip year over year.

The slate for the docket this week includes data on imports, exports and producer prices. Producer prices have seen smaller declines as of late, which might be an early indication that overcapacity in the manufacturing sector is waning. Markets expect producer prices to have declined 0.3 percent on a year-ago basis, an improvement from the -0.8 percent print in August.”