The US has an inflation problem—so does China, it’s just the exact opposite one

Prices go up too fast? Boo. Prices go down? Also boo.

That’s the short version of the dueling narratives in the two most important economies on the planet, after the latest set of Chinese and the US inflation prints, out last week, revealed that the gaping inflation hole between the world’s two biggest economies is now at its widest since the end of March 2024. 

Though the US breathed a sigh of relief as its inflation rate eased to a lower-than-expected 2.8% in February, consumer expectations for how much prices will rise in the coming 12 months have nearly doubled since November, as the American middle class expects to continue having to contest with price rises. In China, however, the opposite is true — the latest consumer inflation figures dropped far more than expected to -0.7%, leaving Chinese CPI below zero for the first time in 13 months.

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