通胀监测：PPI传导仍在持续，CPI指向需求走弱

Inflation monitor: PPl pass-through continues;CPl points to softer demand Economist+852-2203-6166 are shifting. Headline PPl inflation rose to 3.9% YoY, accelerating by 1.1ppt fromApril. On a MoM basis, PPI inflation moderated by 1.2ppt from the previousmonth but remained positive at 0.5% MoM. With international oil prices broadlystable during the month, oil-related sectors saw a small MoM drop in prices.Meanwhile, the pass-through of earlier energy price increases to mid- anddownstream sectors continued, with chemicals, ferrous metals and textiles allregistering faster sequential price gains. In addition, Al-related demandcontinued to push up prices in non-ferrous metals such as tin and copper,electrical machinery,opticalfibers,wiresand cables,as well ascomputers. Chief Economist+852-2203-6139 Looking ahead, we maintain our forecast that PPl inflation will rise to around 5%by year-end, averaging 3.3% in 2026. While energy prices were the key driver inMarch and April, the focus ahead will be on the breadth of pass-through to mid-and downstream sectors,as well as the strength of Al-relateddemand. Headline CPl inflation was unchanged at 1.2% YoY, but the breakdown points tosoftening domestic demand. Sequential inflation turned negative, falling 0.1%MoM after a O.3% increase inApril.Services,food, household goods andautos allsaw MoM declines and slower YoYinflation,pointingto softerconsumer demand.Energy prices declined 0.1% MoM, compared with a 5.7% rise in the previousmonth.Meanwhile, Al-related demand lifted prices of mobile phones andcomputers, which rose 1.6% and 1.1% MoM, respectively, while the arrival ofsummeralso supportedstronger clothingprices. Astheboosttogoods consumption fromthetrade-insubsidieswill likelydiminishmarginally,consumer demand is likelytoremain soft.Wetherefore lowerourfull-year CPl inflation forecast to 1.5% from 1.6%, and now expect it to rise to 1.8% byyear-end, compared with our previous forecast of 2.0%. Figure8:PPlreflationemerged inmid-and Figure7:Werevisedownthefull-yearCPIforecastto Source: Deutsche Bank Research, Wind Source: Deutsche Bank Research, Wind Appendix 1 The views expressed in this report accurately reflectthe personal views of the undersigned lead analyst(s).In addition,the undersigned lead analyst(s) has not and will not receive any compensation for providing a specificrecommendation orview inthisreport.Deyun Ou, Yi Xiong,Ph.D.. Prices are current as of the end of the previous trading session unless otherwise indicated and are sourced from local companies,and other sources. For further information regarding disclosures relevant to Deutsche Bank Research,pleasevisitourglobal disclosure look-uppage on our website athttps:/research.db.com/Research/Disclosures/FiCCDisclosures.Aside from within this report, important riskandconflict disclosures can also be found at https://research.db.com/Research/Disclosures/Disclaimer. Investors arestronglyencouraged to reviewthis information before investing. China Macro 'Deutsche Bank'). Though the information herein is believed to be reliable and has been obtained from public sourcesbelievedtobe reliable,Deutsche Bank makes no representation as to its accuracy or completeness. Hyperlinks tocontent noris responsiblefortheaccuracy orsecuritycontrols of thosewebsites. report, oris included ordiscussed in another communication (oralorwritten)froma DeutscheBankanalyst, DeutscheBank may act as principal for its own account or as agent for anotherperson. ownaccount orwith customers,ina mannerinconsistentwiththeviewstaken inthis research report.Others withinDeutsche Bank,including strategists,sales staffandotheranalysts,maytakeviews thatare inconsistentwiththosetaken in this research report. Deutsche Bank issues a variety of research products, including fundamental analysis,equity-linked analysis,quantitative analysis and trade ideas.Recommendations contained in one type ofcommunication maydifferfrom recommendations containedin others, whetheras a result of differingtime horizons,methodologies,perspectivesor otherwise.DeutscheBank and/orits affiliates may alsobeholdingdebtorequitysecurities of the issuers it writes on.Analysts are paid in part basedontheprofitability of Deutsche Bank AG and itsaffiliates, which includes investment banking, trading and principal trading revenues. Opinions, estimates and projections constitute the current judgment of the author as of the date of this report.Theydonot necessarilyreflect the opinions of Deutsche Bankandaresubject to changewithout notice.Deutsche Bankprovides liquidity for buyers and sellers of securities issued by the companies it covers.Deutsche Bankresearchtermratings.Sometradeideas for equities arelistedas Catalyst Calls on theResearchWebsite(https://research.db.com/Research/), and can be found on the general coverage list and also on the covered underperform themarket and/ora specified sector overa timeframe of no less than two weeks and no morethanthreemonths.In a