Soft March CPI Strengthens Case For Rate Cuts In China
Source: SeekingAlpha
2025-04-10 02:00:00 ET
Summary
- CPI inflation failed to rebound above the zero threshold in March as price pressures persisted across the board.
- Combined with a sharp escalation of tariffs, this sets up a suitable window for the People's Bank of China to resume monetary policy easing.
- In light of lower-than-expected inflation in the first quarter, as well as an escalation of tariffs which will worsen the overcapacity problem and intensify price competition, we are downgrading our 2025 CPI inflation forecast from 0.7% to 0.0% YoY.
By Lynn Song
Deflationary pressures remain significant
CPI inflation rose slightly from -0.7% year-on-year to -0.1% YoY in March, coming in softer than forecasts as we saw broad-based price pressures across the economy....
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Soft March CPI Strengthens Case For Rate Cuts In China
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