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Chinese economy expected to have slipped into deflation as recovery falters
(www.theguardian.com)
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this post was submitted on 08 Aug 2023
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I don't know if deflation itself is that harmful or if it's just a symptom of economic troubles, i.e. lack of demand. In any case, if it persists, that's not a good outlook for the Chinese economy.
Both, it's a positive feedback loop, and in the end it doesn't really matter what started it once the economy crashes you've gone through multiple lack of demand -> prices fall -> even more lack of demand iterations.
"positive" as in engineering, not as in good