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Is China really deflating deflation? It’s harder than Beijing thinks

Prices may be rising but it’s unclear Beijing has delivered the structural reforms needed to escape its deflationary trap

by William Pesek June 12, 2026June 17, 2026

China's prices are rising but deflation isn't easily reversed once entrenched. Image: LinkedIn

TOKYO – China’s “deflation-is-over” narrative is getting louder, but the foundations are still shaky. Consumer prices rose 1.2% year-on-year in May, while producer prices jumped 3.9%, lifted by higher costs for energy, semiconductors and metals. To many economists, this is the clearest sign yet that the 2025 deflation scare is giving way to reflation. But […]