Chinese economy slips into deflation as recovery falters and demand slows

Consumer price inflation data shows prices fell by 0.3% year on year in July

China's economy has fallen into deflation after consumer prices fell year on year last month for the first time in more than two years, official data shows, as slowing domestic spending weighs on the country's post-Covid economic recovery.

The consumer price index, the main gauge of inflation, fell 0.3% in July, the National Bureau of Statistics of China (NBS) said, having flatlined in June. A survey of analysts had anticipated a 0.4% year-on-year decline.