Economy

Xi Jinping's new headache: After zero inflation in 2025, is China heading to a deflation year

January 9, 2026

China is facing a significant deflation crisis after recording zero consumer price inflation in 2025, the lowest rate in 16 years. Despite government stimulus efforts, ongoing price wars and weak demand are exacerbating the situation, leading to concerns about prolonged economic stagnation.

Price wars and weak demand are keeping deflation risks high

Credit: Firstpost

Key Highlights

China recorded zero consumer price inflation in 2025.
This marks the lowest inflation rate in 16 years.
Weak demand and price wars are increasing deflation risks.
Beijing's stimulus measures are struggling to counteract the economic downturn.
Concerns about prolonged deflation are being raised among economists.

World Business

Sources

Xi Jinping's new headache: After zero inflation in 2025, is China heading to a deflation year

This quick summary is automatically generated using AI based on reports from multiple news sources. The content has not been reviewed or verified by humans. For complete details, accuracy, and context, please refer to the original published articles.

Xi Jinping's new headache: After zero inflation in 2025, is China heading to a deflation year

Key Highlights

Sources

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