Growth Dragons Weekly: Will Alibaba Get Regulated Again? Plus: CATL Soars, Solar Giants Unite, and CamScanner IPO
What happened in China this week:
China Inflation Rises 0.1%, Ending 4-Month Decline—But Demand Still Weak
Will Alibaba Get Regulated Again?
Top 2 Solar Giants Finally Join Forces to End Price War
World’s Largest EV Battery Maker CATL Gains 43% Since HK Debut
CamScanner Rides the AI Wave as Parent Company INTSIG Prepares for IPO
#1 China Inflation Rises 0.1%, Ending 4-Month Decline—But Demand Still Weak
China’s consumer price index (CPI) edged up 0.1% year-on-year in June, breaking a four-month streak of declines, according to the National Bureau of Statistics. The slight rebound was driven by a recovery in industrial consumer goods prices and reflects tentative signs of inflation returning amid ongoing government efforts to stimulate domestic demand.
But the broader picture remains fragile. The Producer Price Index (PPI) fell 3.6%—its steepest drop in nearly two years—highlighting continued deflationary pressures in the manufacturing sector.
Worsening the outlook, escalating trade tensions with the U.S. and new transshipment tariffs threaten to further weaken China’s export engine, putting even more pressure on producer prices.
At no point in recent history has China faced such urgency to build a self-sustaining domestic economy. With exports becoming an increasingly unreliable growth driver—especially under the shadow of Trump-style trade policies—China must now rely on internal consumption. Yet domestic demand remains weak.
The bottom line: China’s economic growth is likely to remain subdued. But remember, the stock market isn’t the economy. Stocks are forward-looking. The brutal performance of Chinese equities over the past three years may have already priced in much of this pessimism. In fact, the rebound in Chinese stocks over the past year could be a leading signal that the economy might finally be stabilizing—if not improving—but perhaps only starting in 2026.