China’s consumer inflation slows in July

The National Bureau of Statistics (NBS) reported Wednesday that China’s producer price index (PPI) rose 5.5 percent y-o-y in July, in-line with the pace in June and economists’ forecast.

The producer price inflation steadied on growing commodity prices, as demand stayed resilient and the government’s drive to reduce industrial capacity takes hold.

The PPI rose 0.2 percent m-o-m in July, marking the first increase in four months.

Meanwhile, the consumer price index (CPI) increased 1.4 percent y-o-y in July, decelerating from June’s 1.5 percent y-o-y increase. That was the lowest inflation rate since April and below economists’ forecast for 1.5 y-o-y gain.

The NBS attributed weaker July inflation to slowed growth of non-food prices (+2 percent y-o-y, compared with a 2.2 percent y-o-y increase in June) and continued declines in food prices fell (-1.1 percent y-o-y, compared with a 1.2 percent y-o-y drop in June).

In m-o-m terms, the CPI edged up 0.1 percent in July, following a 0.2 percent fall in the previous month.