unconventional-wisdom-chinas-deflation-risk

Unconventional wisdom: ChinaÆs deflation risk

The view that China is exporting inflation is wrong. On the contrary, China is facing a deflation risk.
By Chi Lo
August 13, 2007
The view that China has a tight labour market that would boost inflation is also wrong labour shortage is still a distant event. Domestic structural and policy backdrops in China argue that there is no momentum for inflation to spread. Chinese exports are not a threat to AmericaÆs inflation. Rather the real threat lies in the myopic mentality among some trade protectionist politicians, who would end up pushing up US inflation rate if they get their way.

The myopic view
The average price of AmericaÆs imports from China turned positive for the first time in June up 0.6% YoY. ChinaÆs domestic inflation rate has also been on the rise in recent months, reaching...
¬ Haymarket Media Limited. All rights reserved.

FinanceAsia has updated its subscription model.

Registered readers now have the opportunity to read 5 articles from our award-winning website for free.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team subscription (2-5 users), or office-wide licences.

To help you and your colleagues access our proprietary content, please contact us at [email protected], or +(852) 2122 5222

Article limit is reached.

Hello! You have used up all of your free articles on FinanceAsia.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team subscription (2-5 users), or office-wide licences. To help you and your colleagues access our proprietary content, please contact us at [email protected], or +(852) 2122 5222