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China Deflation Threat Grows as Companies Cut Prices to Survive
When China abandoned pandemic restrictions after three years of stringent controls, Nie Xingquan was expecting booming sales for his hand-made leather shoes. Instead, demand has been so poor that he’s had to cut prices 3% from a year ago and reduce his profits. It’s an ominous sign of the deflationary pressure that’s hitting Chinese businesses as the economy weakens, and threatening to undermine Beijing’s stimulus plans if consumers opt to defer spending. Nie said his Italy Elsina Group Co., which is based in eastern China’s Wenzhou city and caters to domestic retailers and consumers, has seen business tail ... (full story)