通胀监测：再通胀进程暂歇

Inflation monitor: Reflation taking a break Economist+852-2203-6166 on-monthbasis,withmostcomponentsdeceleratingfromMay.Thedeclineisbroaderthan loweroil prices; it reflects that softening domestic demand is startingtonegativelyimpactChina'sreflationmomentum. Chief Economist+852-2203-6139 Headline CPI fellto 1.0% YoY and -0.3% MoM due to sharp declines in energy andsubdued food inflation,while core inflation also decreased, though services andAl-related product prices remained relatively resilient. Energy prices fell sharply by 4.5% MoM, reducing the contribution to CPlby 0.2ppt. Food inflation also remained subdued at -1.6% YoY.Core inflation edged down 0.1ppt to 1.0% YoY, the lowest reading sinceSeptember last year(after Lunar New Year adjustment).On a sequentialbasis, it fell o.1% MoM, marking a second consecutive monthly decline.Consumer goods prices showed weakness, dropping by 0.5ppt to 1.1%YoY. Prices of home appliances and autos saw moderation, likelyresulting from diminished impact from trade-in subsidies.Prices of services and Al-related products remained relatively resilient.Services inflation held steady at 0.8%YoY, with inflation in education,tourism and recreation edging up by 0.1ppt on YoY horizon. Meanwhile,communication device prices accelerated by a further 1.0ppt to 7.6%YoY. PPl rose to 4.1% YoY due to base effect; however, it declined by 0.3% MoM asthe oil-price shock on upstream and midstream faded, while only limited pass-through to downstream industries emerged amid weak domestic demand. Oil-price shockinupstream andmidstream sectors isfading.PPlinflationin fossil-fuel-related industries turned sharply negative on a MoM basis,weighing onprices forchemicals,plastics and rubberproducts.There are signs that previous price hikes are being passed through tosome downstream sectors,such as equipment,furniture,automobilesand communication devices. However, the pass-through remainsmodest, constrained by soft domestic demand. Wereiterateourfull-yearCPlinflation forecastat1.3%andPPl inflationforecastto3.0%,bothofwhichhavebeenreviseddowninourH2outlook.ThelatestJunedata confirmsthat softeningdomesticdemandhas increasinglytransmitted intopricedynamics,preventingpricetransmissionfromupstreamtodownstreamproducts.Looking forward, we expect moresupportivedomesticpolicyinthesecond half, fiscal spending in particular, will help revert the recent slip inweakeningfurther. China Macro Figure 7:Consumer goods prices showed weakness China Macro Appendix 1 The views expressed in this report accurately reflect the 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 specificrecommendationorview inthisreport.DeyunOu, YiXiong,Ph.D.. Prices are current as of the end of the previous trading session unless otherwise indicated and are sourced fromlocal exchanges via Reuters, Bloomberg and other vendors . Other information is sourced from Deutsche Bank, subjectcompanies, and other sources. For further information regarding disclosures relevant to Deutsche Bank Research,pleasevisitourglobal disclosurelook-uppage on ourwebsite athttps://research.db.com/Research/Disclosures/FICCDisclosures. Aside from within this report, important risk and conflict disclosures can also be found at https://research.db.com/Research/Disclosures/Disclaimer. Investors arestronglyencouragedtoreviewthisinformationbefore investing. China Macro 'Deutsche Bank'). Though the information herein is believed to be reliable and has been obtained from public sourcesbelieved to be reliable, Deutsche Bank makes no representation as to its accuracy or completeness.Hyperlinks tocontent noris responsiblefortheaccuracyorsecuritycontrolsof thosewebsites.If you use the services of Deutsche Bank in connection with a purchase or sale of a security that is discussed in this report, oris included ordiscussed in another communication (oralorwritten)froma DeutscheBankanalyst, DeutscheBank mayact as principal for its own accountor as agentforanotherperson. ownaccount orwith customers,ina mannerinconsistentwiththe viewstaken 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 contained in others, whetheras a result of differingtime horizons,methodologies,perspectivesor otherwise.DeutscheBank and/orits affiliates mayalsobeholdingdebt or equitysecurities 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 ju