The focus on China’s first-quarter economic data was primarily on GDP growth, with less attention given to deflation. Real GDP grew by 5.3% year-on-year in the first quarter, surpassing the annual target of around 5%. However, nominal GDP only grew by 4.2%, indicating a 1.1% year-on-year decrease in the GDP deflator.
The GDP deflator provides a broader measure of price level changes compared to the consumer price index and the producer price index (PPI), offering insight into the overall economic situation across different sectors. China’s GDP deflator for the first quarter was at -1.1%, the lowest since 2009 when it was at -1.5% for the second and third quarters.