China: Headline inflation dipped from 2.3% to 2.1% - Rabobank

Michael Every, Head of FMR at Rabobank, notes that today we saw Chinese CPI and PPI, where headline inflation dipped from 2.3% to 2.1%, surprisingly, but PPI surged to 5.5% from 3.3%, the highest since September 2011.

Key Quotes

“It's remarkable how much inflation counter-cyclical fiscal stimulus on an unprecedented scale can achieve; but unless this is going to be China’s policy forever – which has HUGE implications if so – then 12 months from now, we have the base effects for a killer deflation. Near-term.”