Analysts at TD Securities note that China's December CPI rose 4.5% YoY (market 4.7%, TD 4.8%), the same as in November.

• "PPI fell more than expected -0.5% YoY (mkt -0.4%), but its fall was less severe than the 1.4% decline registered in November, suggesting that pressure on industrial profits will also ease.
• Further signs of a waning impact of African Swine Disease (ASD) was reflected in the 5.6% m/m drop in Pork Prices in Dec (though prices were still up 97% y/y compared to a 110% y/y rise in November). This helped contribute to a 0.4% decline in overall food prices over the month. Core inflation remains well contained at 1.4% y/y in Dec.
• We expect the impact of ASD to continue to wane, helping inflation to normalize in the next few months. In the meantime, the PBoC will likely maintain its path of targeted and incremental easing."