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China Exporting Deflation to US
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The US doesn't have to experience a recession to bring inflation down if China's export prices are falling because China is already in a recession. Consider the following:
(1) This evening we learned that China's CPI fell 0.3% y/y during July, the first such drop since February 2021. The PPI fell 4.4% over the same period (chart).
(2) The CPI inflation
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Ed Yardeni
