Beijing, China: China is the world’s second largest economy. But China is currently facing a huge economic problem.
Inflation is a factor affecting a country’s economy. We call inflation the increase in the price of goods and the decrease in the value of the money used to buy them. But the current problem in China is deflation. That is, the price of goods is falling rapidly. At a certain period of time, the value of goods and services is decreasing rapidly, while the value of that country’s currency is increasing rapidly. This is called deflation. Although deflation is beneficial for consumers, it can harm the country’s economy.

Currently, the production of various goods in China has increased, due to which their prices in the market are decreasing. China’s central bank, the People’s Bank of China, is currently focusing on stabilizing the value of the Chinese currency, the yuan. Therefore, the problem of deflation has been neglected. Priority in employment for women and the disabled.. Opening of the Godrej plant.. This will only be corrected if steps are taken to correct it, according to financial institutions such as Citigroup and Nomura Holdings. Various products have been produced and accumulated in large quantities in China.

As a result, sales companies are selling products at large discounts. This has been happening in China for the past few months. Deflation has occurred because various companies are competing and announcing discounts on products. Based on the news published by Reuters, four companies in China have competed and announced discount sales on a single day. Accordingly, they sold goods worth 236 yuan for 20 yuan.

Various companies such as clothing, household appliances, and food have also competed and reduced the prices of their products drastically. Restaurants are also reducing food prices. AI is not the reason for the decline in employment in the IT sector – Zoho founder Sridhar Vembu. Electric car manufacturer BYD has announced a discount of up to $ 10,000 on the price of vehicles. Due to such a continuous decrease in commodity prices, consumer prices in China have decreased by 0.7 percent, the lowest in the last 13 months. If this continues for several months, there will be an economic slowdown there. That is, when commodity prices fall, demand in the economy decreases, if demand continues to decrease, production decreases, and when production decreases, business income decreases.

This will lead to increased job losses. Experts say that this will ultimately cause economic problems. Therefore, this economic situation in China will also affect the global economy.