(NBS) China posted a 0.7% year over year increase in consumer price inflation in September, lower than August’s 0.8% and expected 0.9% jump. The decline reflected weak demand and a fall in volatile food prices.
Despite the fall in CPI, China’s producer price index increased by 10.7% from the prior year, more than expected 10.5%, and the biggest increase since the series data started in 1996.
The rise in PPI was attributed to rising commodity prices. Output curbs due to Chinese power crunch have also been blamed.
Prices increased in 36 out of the 40 industrial sectors, a higher number compared to 32 sectors in August. Mining and coal prices were up by 74.9% from 57.1% in August.
Analysts now say the mixed price data poses a dilemma to Beijing’s policy stance as weak demand prompts some economic support while record PPI calls for tightening.
CSI 300 is down -0.54%, USDCNY is up +0.10%.
