You have it backwards. Inflation is great for those in debt: it reduces the real cost of paying off the creditors. The people that get hurt by inflation are those that rely on savings, as it erodes their value. As inflation occurs in the dollar, it reduces the real value of America's debts, and so the value of China and Japan's reserves. When inflation occurs in the yuan, it's like a retroactive tax on income the Chinese people earned in previous years. Inflation can be thought of as a subsidy given to borrowers at the expense of their creditors: a systematic debt forgiveness, if you will. While inflation may cause some Chinese to save less in order to avoid such penalties, it is also possible that they will instead save *more* in order to insure sufficient savings down the line. It all depends on what their expectations of future inflation, income and expenses are. That said, it's not clear to me that inflation in the yuan is going to increase substantially in the first place. The entire reason the CCP is dumping stimulus money into the economy is that it is in recession, unemployment is spiking, and inflationary pressure is negligible. To the extent that there is any substantial boost in inflation, it will be a sign that the CCP has overdone it on the stimulus.