Description
The inflation rate measures the extent to which the average level of prices increases, typically assessed using the Consumer Price Index (CPI). It is calculated as an annual percentage change to track fluctuations in price levels and variations in the purchasing power of money. An increase in the inflation rate signifies a rise in overall price levels, reducing purchasing power, a phenomenon known as inflation. Conversely, a negative growth rate reflects deflation.
China's inflation rate has remained low in recent years. According to data from the International Monetary Fund (IMF), in 2023, weak domestic demand and a sluggish real estate market contributed to deflation, with a negative growth rate recorded. In 2024, inflation showed slight positive growth due to rising food prices. However, the IMF forecasts that China will continue to face deflationary pressures and concerns about economic slowdown in the coming years.