China’s consumer prices fell the fastest in three years in November, while factory-gate deflation deepened, suggesting heightening deflationary pressure as weak domestic demand casts doubts over the economic recovery.

The consumer price index (CPI) dropped 0.5% both from a year earlier and compared with October, data from the National Bureau of Statistics (NBS) showed on Saturday.

The falls were deeper than the median 0.1% declines, both year-on-year month-on-month, forecast in a Reuters poll. The year-on-year CPI decline was the steepest since November 2020.

Year-on-year core inflation, excluding food and fuel prices, was 0.6%, the same as October, pointing to a daunting task faced by Chinese authorities to revive demand as deflationary forces persist.

Although consumer prices in the world’s second-biggest economy have been teetering on the edge of deflation in recent months, China’s central bank Governor Pan Gongsheng said last week inflation was expected to be “going upwards.”

The producer price index (PPI) fell 3.0% year-on-year against a 2.6% drop in October, marking the 14th straight month of decline and the quickest since August. Economists had predicted a 2.8% fall in November.

Mixed trade data and manufacturing surveys have kept alive calls for further policy support to shore up growth.

China’s economy has grappled with multiple headwinds this year – including mounting local government debt, an ailing housing market and tepid demand at home and abroad – with consumers tightening their purse strings, wary of uncertainties amid an elusive economic recovery.

Moody’s on Tuesday slapped a downgrade warning on China’s credit rating, saying costs to bail out local governments and state firms and control its property crisis would weigh on the economy.

China’s finance ministry called the decision “disappointing”, saying the economy would rebound and risks were controllable.

The authorities will spur domestic demand and enhance economic recovery in 2024, the Politburo, a top decision-making body of the ruling Communist Party, was quoted by state media as saying on Friday.

Markets are awaiting more government stimulus at the annual agenda-setting “Central Economic Work Conference” later this month.