From my understanding, after the GFC in 2008, China was not really hit with much deflation the way the rest of the world was. They were still riding globalization tailwinds that began in the 70s, overtaking the US at most countries top trading partner, and funneling the dollars they received from the sale of exports into real estate projects all around the country.

It wasn’t that China was immune from the shocks of ‘08 but that the lag time to experience them was delayed by a decade and a half. Now the over investment and global collateral shortage is catching up to China, with Evergrande and Country Garden’s liquidations a kind of Lehman moment: not the cause but a strong signal of the deflationary regime they’ve entered.

The rest of the world might enter a recession as well from the post GFC + Covid stimulus cycle rounding off, this will make China’s deflation likely worse.