Macro/China Stimulus Pivot/Market Detail

Will China CPI YoY exceed 1.0% for any month in Q3 2026?

activeStimulus CompositionResolves: November 15, 2026

The Condition

PBOC + State Council announce consumer-facing stimulus exceeding 2% of GDP by end of Q3 2026

External probability: 15.0%Source: Runchey Research meta-synthesis (midpoint of 10-25% range)Resolves: September 30, 2026

Our Ensemble Estimates

If condition is true

28%

Model agreement: 86%

Given demand pivot: Will China CPI YoY exceed 1.0% for any month in Q3 2026?

If condition is false

Model agreement: 97%

Given no demand pivot: Will China CPI YoY exceed 1.0% for any month in Q3 2026?

Causal Effect

+23pp(positive)

Demand-side pivot worth ~23pp to CPI exceeding 1.0% threshold, though still unlikely even with stimulus (28%) due to 40-month deflation inertia and deployment lags

Unconditional probability:8.5%(blended: P(Y|T) × 15.0% + P(Y|F) × 85.0%)

Why This Matters

Tests whether a genuine demand-side stimulus pivot breaks China's 40-month deflation/near-zero inflation cycle. CPI is currently at +0.2% YoY with PPI at -1.4% for 40 consecutive months. The stimulus-composition lens found LOW policy credibility based on persistent deflation despite rhetoric. A demand-side pivot exceeding 2% of GDP would be the first test of whether fiscal spending can overcome the deflationary expectations that may be embedded in firm and consumer behavior.

Resolution Criteria

NBS China CPI YoY reading exceeds 1.0% for any monthly release in Q3 2026 (July, August, or September data)

Source: National Bureau of Statistics (NBS) China / FRED series CHNCPIALLMINMEIDate: November 15, 2026

Source Analysis

China CPI turning negative or PPI beyond -2% signals deflation expectations embedding

Stimulus CompositionPOLICY_CREDIBILITYPriority: HIGH

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