China: Soft inflation data - TDS

Analysts at TD Securities note that China's CPI came in softer than expected at 1.9% y/y in Dec (consensus 2.1%, TD 2.2%).

Key Quotes

“On a monthly basis CPI dropped 0.3%. revealing a second straight month of declining prices. The breakdown revealed that much of the downward pressure on prices came from pork, oil and transport.”

“PPI was even softer at 0.9% y/y (consensus 1.6% y/y) while core CPI came in at 1.8% y/y, the same as in Nov. The data gives more room for more targetted easing measures though inflation was not a constraint in the first place.”