China inflation (January): CPI 1.7% y/y (expected 1.9%), PPI 0.1% y/y (expected 0.3%)

January inflation data from China

CPI 1.7% y/y

• expected 1.9%, prior 1.9%

PPI 0.1% y/y

• expected 0.3%, prior 0.9%
• PPI lower for the seventh consecutive month. Return to deflation chatter not far away (its started already)

Both have come in down from previous and down more than expected.

The PPI slowdown is a concern for the industrial sector, its weighing on profits. If it was soaring they'd be whining about that too though.

Anyway, no hindrance on the inflation front if the PBOC want to ease further.

AUD and NZD down a few tics

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Earlier on China:

• China inflation data due today, expected to confirm modest pressures
• China - estimate 65m urban residences (21.4% of housing) unoccupied (up from 18.4% in 2011)
• MS on the yuan, says market is underestimating the extent of the coming China rebound