The government is targeting 2% in 2025 - they targeted 3% historically - I think that should tell you all you need to know for what is a 'good CPI target'.
Well if your last comment is true I think
@doggydogdo has some explaining to do. I also do recall lots of people here who seem to hate on anything that points to an 'under consumption' issue in China. Which begs the question:
Now that the PBOC Governor and the Politburo has called out under consumption as an issue/problem - are the people who say "China needs to consume more" wrong? Or is the Politburo wrong?
I do realize I am dunking - but I dunk on people who cannot observe problems as I do on Brad Setser/Michael Pettis when they are being retarded. I.E I'm an equal opportunity hater when it comes down to bad takes.
I would not call that "issues or problems"; it is more like
shifts that have to be done in the short term
cyclically.
So, they frame it as such so it actually gets done more urgently. And everything gets done successfully that way.
As seen as how the growth targets are regularly met, job targets are too, 5-year plans are always completed, etc.
You can't separate macroeconomics from industrial policy in economics and economic planning regarding China.
Industrial policy is 70-80% of the focus, and fiscal and monetary policies are just some peripheries (or tools for it).
You can understand this from every single major political public meeting, including the two sessions right now.
Also, their "consumption", is probably not what Western "consumption" is, as it's also based on industrial activity.
Buying more products that would create jobs, through targeted purchase incentives for consumer goods programs,
And not for uncontrolled credit card debt, to chase a limited amount of products, which defies basic common sense.
Economic focus in China is not like what West's macro guys think, but real-world first principles, logic, and mechanics,
For example, how to create more urban jobs, how to do more innovation (with new quality productive forces), etc.
How that will lead to even more high-quality productive economic growth that will improve standards over time.
It's also obvious that no economy can function without consumption (confidence), no one sane ever challenged that.
It just depends on what is the right balance between investment and consumption for the long term, and cycles.
They are issuing more debt now and making other various loose fiscal and monetary adjustments for
sentiment.
It's a counter-cyclical adjustment, for consumer confidence, because it's necessary and makes sense for a while.
