Despite trade war concerns, China's consumer prices rise less than anticipated due to slowing economy.

• According to data from the National Bureau of Statistics, China's consumer prices rose less-than-expected in November, climbing 0.2% from a year ago.
• In November, the consumer price index was predicted by Reuters' polled analysts to increase slightly from October's 0.3% to 0.5%.
• In November, China's producer inflation fell by 2.5% year on year, which was less than the estimated 2.8% decline as per the Reuters poll.

According to data from the National Bureau of Statistics, China's consumer prices rose less-than-expected in November, climbing 0.2% from a year ago.

In November, consumer prices were predicted to increase slightly by analysts polled by Reuters, from 0.3% in October to 0.5%.

In November, China's producer inflation fell by 2.5% year on year, which was less than the estimated 2.8% decline as per the Reuters poll.

Despite Beijing's stimulus efforts, including interest rate cuts and support for the stock and property markets, China is still facing sluggish domestic demand and deflation at the wholesale level.

Based on the ongoing trade war between China and the U.S., Becky Liu, head of China macro strategy at Standard Chartered Bank, predicts that deflation will persist in China.

Liu stated that China's producer price index inflation is expected to remain negative throughout 2025, with inflation, particularly PPI inflation, typically falling to negative territory during such periods.

Analysts at Goldman Sachs anticipate near-zero CPI figures to continue in China next year, according to a note dated Dec. 6.

Despite some challenges, other aspects of China's economy have shown signs of recovery. In October, China's retail sales grew strongly, surpassing expectations. Additionally, the country's manufacturing activity expanded for two consecutive months.

The annual Central Economic Work Conference, attended by top leaders in the country, will commence on Wednesday to establish economic objectives and implement stimulus measures for the year 2025.

Fitch Ratings lowered its 2025 Chinese GDP growth forecast from 4.5% to 4.3% on Monday, and also adjusted its 2026 growth projections from 4.3% to 4.0%.

According to Fitch Ratings Chief Economist Brian Coulton, for the years 2025 and 2026, it is predicted that the U.S. will adopt a more protectionist trade policy towards China. Although there are indications of stabilization in the country's real estate sector, an extended slump in the property market poses a significant threat to Fitch Ratings' forecast.

Additionally, China will release its trade data for November on Tuesday and retail sales figures on Monday.