China's K-Shaped Economy Needs Demand Recovery as CPI Weakens and PPI Cools
Updated
Updated · CNBC · Aug 10
China's K-Shaped Economy Needs Demand Recovery as CPI Weakens and PPI Cools
1 articles · Updated · CNBC · Aug 10
Summary
Hao Zhou of Guotai Junan International said China’s growth now hinges on demand-side recovery, arguing the economy is showing a pronounced K-shaped split.
Cooling producer prices and a weaker consumer price reading point to an uneven pricing backdrop, with soft domestic demand offsetting strength in parts of manufacturing.
Lower-tier cities are a key weak spot because they have benefited less from the AI-driven manufacturing boom that has supported stronger segments of the economy.
Zhou said that imbalance is likely to persist, keeping policy and market attention focused on reviving household demand rather than relying only on industrial momentum.