China has reported a drop in its 'inflation rate,' to 1.7% over the past year. Of course, by 'inflation rate,' China means an increase in its consumer price index, however the heck it fudges the numbers for this. What is ignored is the actual rate of inflation, that is, the rate that money supply increases, which is the better indicator as to how high prices will get.
Now with this 'achievement' of a lower rate of increase of prices, China will have more audacity to continue its inflationary policies which has fueled its boom for many years and which has led to its more recent economic slowdown. Speaking of which, it is this slowdown, more than anything, that is responsible for less consumer demand and relatively low prices.
What does this mean for the investor? It means brace yourself for more price increases, and devaluation of what is thought to be the next world reserve currency after the Dollar diminishes in significance over the next decade or so.
Whatever currency you park your money in, expect devaluation. Unless, of course, you are holding on to the currency known as gold, which is supposed to be backing all these fiat currencies printed by governments. Continued inflation means bullish gold.
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