Source: Donghai Futures Research Investment Highlights Events Highlights: China's CPI grew by 1.6% year-on-year in November, expected to be 1.6%, with the previous value of 2.1%; November's PPI grew by -1.3% year-on-year, expected to be -1.4%, and the previous value of -1.3%. 1.

Category：hotcomm

2025-09-27

Source: Donghai Futures Research

Investment Highlights

Event Highlights: China's CPI in November increased by 1.6% year-on-year, expected 1.6%, and the previous value was 2.1%; November's PPI increased by -1.3% year-on-year, expected -1.4%, and the previous value was -1.3%.

1. Inflation continued to fall overall in November, and inflation continued to ease. Although there is a high base effect on on the upstream side, the prices of commodities such as nonferrous and black commodities rebounded in the short term, and the PPI decline remained flat; downstream consumption continued to slow down, pork and fresh vegetables prices fell sharply, and last year's high base, CPI continued to fall, and inflation continued to slow down overall. At present, although overseas currency tightening slows down, commodities such as energy and nonferrous metals have certain support, foreign demand has generally declined, the upward pressure on upward inflation in foreign countries continues to ease, and domestic upstream imported inflation has weakened; overall, upstream PPI is likely to continue to decline as the base gradually rises last year and the upstream price center falls. The downstream food side is mainly due to the slowdown in domestic consumption demand and the decline in prices of pork, fresh vegetables, etc., CPI continues to fall and inflation continues to slow down. In the current situation where the domestic economic stabilization pressure is high and inflation continues to slow down, the domestic monetary policy is expected to continue to maintain a loose level; in the short term, the domestic interest rate overall run at a low level; medium- and long-term domestic interest rates need to continue to pay attention to the domestic economic recovery after the optimization of epidemic prevention and control measures and the recovery rhythm of the real estate market.

2. In November, CPI increased by 1.6% year-on-year, expected to be 1.6%, with the previous value of 2.1%. Inflation further fell and in line with market expectations. The year-on-year increase fell a lot, mainly due to the impact of the rise in the same period last year on the rise in the base; was 5-0.2% month-on-month, expected to be -0.2%, in line with expectations. Among the 1.6% year-on-year CPI increase in November, the tail-strike impact of price changes last year was about -0.3 percentage points, and the new price increase was about 1.9 percentage points. Among them, food prices rose by 3.7%, and the increase in fell by 3.3 percentage points from the previous month, affecting the CPI increase by about 0.68 percentage points. Among foods, pork prices rose by 34.4%, a decrease of 17.4 percentage points from the previous month, affecting the CPI increase by about 0.47 percentage points; fresh vegetables prices fell by 21.2%, a decrease of 13.1 percentage points from the previous month, affecting the decline of CPI by about 0.53 percentage points. Non-food prices rose 1.1%, the same as last month, affecting the CPI rise by about 0.88 percentage points. Among non-foods, the prices of gasoline, diesel and liquefied petroleum gas rose by 11.4%, 12.3% and 4.6% respectively, with the increase falling; the price of household services rose by 2.3%, with the increase falling by 0.2 percentage points from the previous month. Overall, food prices fell sharply, non-food prices continued to fall, and inflation continued to slow down.

3. In November, PPI increased by -1.3% year-on-year, expectation was -1.4%, and the previous value was -1.3%. PPI remained flat year-on-year and basically met market expectations, mainly affected by the high comparison base in the same period last year. Among the 1.3% year-on-year decline in PPI in November, the tail-strike impact of price changes last year was about -1.2 percentage points, and the new price increase was about -0.1 percentage points. On the foreign side, due to the slowdown of the rate hike of by the Federal Reserve, the prices of commodities such as crude oil and nonferrous metals rebounded in the short term; on the domestic side, with the continuous optimization of domestic epidemic prevention and control measures and the intensification of real estate support policies, black commodities rebounded sharply in the short term, and the upstream raw material side's drag on PPI weakened; due to the impact of the epidemic in the downstream, consumption demand continued to slow down, which still had a certain drag on PPI. Among them, the price of means of production fell by 2.3%, a decrease of 0.2 percentage points from the previous month, affecting the total level of industrial producer ex-factory prices to fall by about 1.72 percentage points, and the contribution of increase and increase narrowed; the price of domestic materials rose by 2.0%, a decrease of 0.2 percentage points, affecting the total level of industrial producer ex-factory prices to rise by about 0.46 percentage points. Among the major industries, the price decline has expanded: the chemical raw materials and chemical products manufacturing industry fell by 6.0%, an increase of 1.6 percentage points; the chemical fiber manufacturing industry fell by 3.7%, an increase of 2.6 percentage points. The decline narrowed include the ferrous metal smelting and rolling processing industry, which fell by 18.7%, narrowing by 2.4 percentage points; the coal mining and washing industry, which fell by 11.5%, narrowing by 5.0 percentage points; the non-ferrous metal smelting and rolling processing industry, which fell by 6.0%, narrowing by 1.8 percentage points.The price increase has fallen: the oil and gas mining industry rose 16.1%, down 4.9 percentage points; the agricultural and sideline food processing industry rose 7.9%, down 0.8 percentage points; the petroleum, coal and other fuel processing industry rose 6.9%, down 1.7 percentage points.

4. Since June this year, as the pace of the Federal Reserve's interest rate hike in accelerated, the rate hike in has increased, the growth rate of the global economy of has slowed down rapidly, and demand has gradually weakened; however, on the one hand, due to the slow recovery of foreign production, the supply and demand gap still exists, and the inflation pressure on the industrial product side is still there; on the other hand, the labor market in Europe and the United States is still strong, wage growth remains high, consumption remains strong, and consumption is still strong, and consumption is still relatively high, and the pressure on consumption is still relatively large. European and American CPI or core CPI continues to maintain a high level, and the inflation pressure on Europe and the United States is still relatively large. However, due to the impact of high base and frequent epidemics in China, domestic consumption demand has weakened, and the demand in the real estate market continues to weaken, and the price increase of domestic and foreign demand commodities has fallen sharply, and the inflation pressure on the CPI and PPI side has been greatly alleviated. At present, due to the continuous optimization of domestic epidemic prevention and control measures and the continuous introduction of real estate support policies, domestic demand-based commodities have rebounded in the short term. In addition, as the pace of Fed interest rate hikes slowed down, the US dollar continued to weaken, risk preference heated up, and foreign-demand commodity prices continued to rebound in the short term. At present, although overseas currency tightening slows down, commodities such as energy and nonferrous metals have certain support, foreign demand has generally declined, the upward pressure on upward inflation in foreign countries continues to ease, and domestic upstream imported inflation has weakened; overall, upstream PPI is likely to continue to decline as the base gradually rises last year and the upstream price center falls. The downstream food side is mainly due to the slowdown in domestic consumption demand and the decline in prices of pork, fresh vegetables, etc., CPI continues to fall and inflation continues to slow down.

Figure 1 CPI and PPI year-on-year