Credit Agricole's Kowalczyk Sees 2H Decline in China PPI

The video discusses the diverging trends in Chinese inflation, focusing on CPI and PPI. It highlights the correlation between factory gauges and producer inflation, noting the impact of base effects. The economic outlook suggests a slowdown in growth, with real interest rates rising. Commodities are identified as key drivers of inflation, with food prices affecting CPI. The policy response involves tightening monetary policy and easing fiscal measures to manage inflation and protect the currency.

What is the expected trend for the Chinese producer price index (PPI) in the second half of the year?

• Significant increase

• Fluctuate unpredictably

• Remain stable

• Significant decline

Which factor is primarily responsible for the low consumer price index (CPI) in China?

• High energy prices

• Low food prices

• Increased industrial output

• Rising commodity prices

What does the high level of core inflation indicate about the Chinese economy?

• It is struggling

• It is stable

• It is declining

• It is performing well

What is the expected policy response in China to address inflation and economic conditions?

• Monetary easing and fiscal tightening

• Monetary tightening and fiscal easing

• Both monetary and fiscal easing

• Both monetary and fiscal tightening

How will the expected policy response affect the Chinese currency?

• It will strengthen the currency

• It will weaken the currency

• It will have no effect

• It will cause high volatility