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Inflation miracle

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Why you can trust SCMP
Carrie Lee

IF you are over the moon about the drop of China's consumer price index inflation November, come back down to earth.

It is wonderful for investors and mainland officials to believe the country's inflation has finally peaked, in the same way as it is for children to believe in Santa Claus.

But there is little evidence that a soft economic landing is on the horizon.

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Just because the inflation indication represented the first fall in 18 months does not necessarily signal a downward trend as suggested by the State Statistics Bureau.

It can mark the beginning of a fickle roller-coaster pattern instead of a straight trend.

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And even the Statistics Bureau itself - usually making figures appear in a good light - warned that the November indicator at 27.5 per cent was still unacceptably high.

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