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China Economy

Inflation slows in China as food price rises ease

PUBLISHED : Friday, 09 September, 2016, 11:29am
UPDATED : Friday, 09 September, 2016, 10:33pm

Consumer inflation slowed in China last month amid lower food prices.

China’s factory gate prices also fell in August, but by a lower margin than the previous month.

The official producer price index was down 0.8 per cent, compared with a 1.7 per cent decline in July.

The consumer price index rose 1.3 per cent last month, beating analysts’ forecasts.

They expected inflation to rise by 1.7 per cent.

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Yu Qiumei, a senior statistician at the National Bureau of Statistics, said the milder consumer inflation was mainly due to lower food inflation. Food accounts for about a third of the basket of goods used to compile the index.

Shao Yu, chief economist at Oriental Securities, said consumer inflation was lower than expected, indicating weakness still remains in the economy. “We expect more pro-growth measures to come in the fourth quarter to consolidate growth.”

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China’s GDP grew at its slowest pace in 25 years last year as its economy slows.

The economy grew 6.7 per cent in the second quarter of this year.