Reflation Dead? Second Month of Price Deflation in China
The CPI rose from 1.2 percent to 1.5 percent yoy in May thanks to the year-ago drop of 0.5 percent falling out of the calculation. The Spring Festival price spike is still the only thing keeping the CPI above 1 percent.
The PPI was in contraction for the second consecutive month. These numbers are consistent with the price deflation seen prior to 2016.