FX.co ★ China Consumer Prices Fall for 4th Month

In May 2025, China's consumer prices fell by 0.1% when compared to the same period last year, consistent with the decline observed over the previous three months. This figure slightly undercuts market predictions of a 0.2% decrease. The current trend marks the fourth consecutive month of consumer deflation, underscoring ongoing challenges such as persistent trade tensions with the United States, weak domestic demand, and concerns about job stability. Non-food prices remained unchanged for the second month in a row. During this period, a rise in the costs of housing at 0.1%, healthcare at 0.3%, and education at 0.9% contrasted with a more pronounced drop in transportation costs, which fell by 4.3%. On the food front, prices saw a sharper decline, decreasing by 0.4%. Core inflation, which excludes the more volatile categories of food and fuel, increased to 0.6%. This marks the highest level of core inflation since January, following a 0.5% rise during the previous two months. From a monthly perspective, the Consumer Price Index (CPI) dropped by 0.2% in May, reversing the 0.1% increase noted in April and marking the third month of decline in the current year.