China's CPI inflation edged up in September, but the economy remained in deflation. The main reason is a continued slide in food prices down to -4.4% YoY, a 20-month low. This is, in part, base effect-driven, as MoM prices actually picked up 0.7%. The primary culprit has been pork (-17%), which is currently in a downward trend and likely to continue dragging food inflation for several more months. On a YoY basis, we continued to see notable drags from vegetable (-13.7%), egg (-11.9%), and fruit (-4.2%) prices despite MoM gains for each of these categories. The drag from these categories may persist in October, but ... (full story)