中国经济：上游行业温和再通胀

CMB International Global Markets |MacroResearch | EconomicPerspectives China Economy Mild reflation in upstream sectors Frank Liu(852) 3761 8957frankliu@cmbi.com.hk YoY CPI edged up in Sep as food price rebounded. Core CPI rose to a recenthigh, indicating a gradual recovery of consumer demand. PPI narrowed itscontraction asthemining sectornotably rebounded, while the downstreamconsumergoods remained subdued.The recent Premier’s symposiumindicatedthatthe future policy focus includes stronger macro policy support,domesticdemand stimulus and countering over-competition.Therefore,against the rising trade tensions and the backdrop of potentially sharpslowdowns in retail sales and the property market in 4Q25, demand-sidestimulusand supply-side restructuring appear increasingly necessary tosupport the economic recovery and reflation,in our view. We expect a policyeasing window in 4Q25 withafurther 10bps LPR cut and 50bps RRR cut, andexpanding fiscal stimulus towards consumption andtheproperty market.WeforecastCPItoremainunchanged at 0.2% in 2025 while PPI may drop from-2.2% in 2024 to-2.5% in 2025;CPI and PPIYoYin 4Q may recover to 0.3%and-2.3% from-0.2% and-2.9% in 3Q. Bingnan YE, Ph.D(852) 3761 8967yebingnan@cmbi.com.hk CPImarginally recovered as food price rebounded.China’sCPI YoYrecoveredto-0.3% in Sep from-0.4% inAug,missingmarket expectationat-0.1%.In sequential terms, CPIrebounded to 0.1% from0% inAug.Foodpriceincreased by 0.7% MoM in Sep, mildly weaker than the 1.2% averageincrease inthepast 10 years. Vegetable price rebounded by 6.1% whilepork price saw another drop at-0.7% in Sep. Vehicle fuelpricedropped1.7%MoM due toadeclining crude oil price.We expect the CPI torecoverto-0.1% YoYin Octdue toalower base last year, while high frequency dataindicatedthat the prices of pork, vegetable and vehicle fuel remainedsubdued. Forecast numbers from Oct 2025Source: Wind, CMBIGM Core CPI rose to a recent high, indicating a gradual recovery inconsumer demand.Core inflationedged up to1%YoYinSep from 0.9%in Aug,the highest record since early 2024.Core CPI MoM remainedunchangedat 0%.Durable goods includinghomeequipmentandtelecomequipmentrose0.6% and 0.1%respectivelyas June promotion activitiesended,whileauto pricedropped 0.1% as price competition remained fierce.It’s worth noting that the discounts fromthetrade-in scheme are excludedfrom CPI calculations. Discretionary goods notably rebounded under theseasonal pattern as footwear and clothingexpandedby0.8% and0.7% inSep.Service pricedropped to-0.3% MoM in Sep, astourism pricesharplydeclinedby6.1% while education and medical service rose by 0.5% and0.3%.Other services including rent, express,telecommunications andhomeservicesremained unchanged. Source: Wind, CMBIGM PPInarrowed itscontractiondriven by reflating upstream sectors.YoYcontractionof PPInarrowed to-2.3%in Sep from-2.9%, beating the marketexpectationsat-2.4%.The MoM growthremained flat for another month inSep, marking the first time without two consecutive negative readings sinceOct 2023.PPI ofmining industriesrebounded by 1.2%MoMin Sep, drivenby the2.5%, 2.6% and 2.5%growth ofextraction of coal, non-ferrous metalsand ferrous metals,whilethe mining ofcrude oil and gasdeclined.Non-ferrousmetals rose 0.7%MoM.PPI of raw material sectors stayedunchanged in Sep while processing sectors dropped by 0.1%MoM. NBSofficials pointed out that YoY price contraction has notably narrowed inmajorsectors including coal processing,ferrous metals,photovoltaicequipment, battery and non-metallic mineral products, thanksto the effortfromtheanti-involution campaign.Downstream sectors remained subdued,as PPI of consumer goods dropped 0.2% MoM.Durable goods further dropped 0.4%MoMin Sep, as auto and computers & electronics declinedby 0.5% and 0.2%. Economic rebalance and moderate reflation will remain key policytargets in near term.The recent Premier’s symposium indicated that thefuture policy focus willbestronger macro policy support, domestic demandstimulusand countering over-competition.Economic rebalance andmoderate reflation will serve askey policy targets. Therefore, against thebackdrop of rising trade tensionsand potentially sharp slowdowns in retailsales and the property market in 4Q25, Chinese policymakers are likely tolaunch additional monetary loosening and fiscal stimulus to boost economicgrowth and defy deflation, in our view. We expect a policy easing window in4Q25 withafurther10bps LPR cut and 50bps RRR cut and additional fiscalsupport to household consumption andtheproperty sector. Source: Wind, CMBIGM Source:Wind, CMBIGM Source: Wind, CMBIGM Source: Wind, CMBIGM Source:Wind, CMBIGM Source: Wind, CMBIGM Source:Wind, CMBIGM Source:Wind,CMBIGM Source: Wind,CMBIGM Source: Wind, CMBIGM Source: Wind,CMBIGM Source: Wind, CMBIGMestimates Source:Bloomberg, CMBIGM Source:Wind, CMBIGM Source:Wind,CMBIGM Source:Bloomberg, CMBIGM Source:Wind, CMBIGM Source:Bloomberg, CMBIGM Source:Bloomberg, CMBIGM