China's producer prices fell 0.3 percent in June compared to the previous month, according to new data from the country's national statistics agency, signalling that manufacturers remain locked in a destructive price war driven by weak domestic demand and excess supply. With nearly 24 percent of Chinese firms already operating at a loss — according to the Merics think tank — companies are increasingly turning to exports to survive, illustrated starkly by a 23 percent collapse in domestic car sales alongside an 82 percent surge in vehicle exports in the same period. The persistent deflationary pressure raises serious doubts about China's ability to meet its official 2026 growth target of 4.5–5 percent, with the IMF and World Bank both projecting a more modest expansion of around 4.4–4.6 percent.