Consumer price inflation slows in Sep, PPI still increasing

China’s consumer price inflation retreated mildly in September, weighed down by dropping food prices, while growth in factory-gate prices hit a sixmonth high on strong domestic demand for raw materials.

The consumer price index (CPI) grew 1.6 percent year-on-year in September, slowing from August’s 1.8 percent, but still faster than July’s 1.4 percent, the National Bureau of Statistics (NBS) said Monday. It was the eighth straight month for the gauge to stay beneath the 2 percent mark.

On a monthly basis, the index was up 0.5 percent, slightly higher than the 0.4 percent seen in August.

NBS official Sheng Guoqing attributed the milder inflation to lackluster food prices, which account for a significant part of the CPI data.

“Food prices declined 1.4 percent from a year ago, contributing 0.28 percentage points to the slowdown,” said Sheng.

Pork prices, a staple meat in China, dragged down the whole sector with a loss of 12.4 percent.

Meanwhile, the increase in nonfood prices picked up. Led by services including heathcare and home rents, non-food prices gained 2.4 percent year on year. The pace quickened marginally from August’s 2.3 percent.

Healthcare prices jumped 7.6 percent from a year earlier, the biggest increase in around 20 years. Home rents and education, culture and entertainment product prices also saw marked increases.

Excluding food and energy prices, the core CPI increased 2.3 percent year-on-year last month, up slightly from August’s 2.2 percent. Economists believe the index, free from short-term supply changes, can better reflect long-term price trends.

China’s producer price inflation, which has been soaring since the end of 2016, registered the fastest growth since April. The producer price index (PPI) was up by 6.9 percent year-onyear in September.