China’s consumer prices gain for second month, factory deflation stays
China’s consumer prices in March rose for a second straight month while producer price deflation persisted, pointing to still weak demand despite signs that the struggling economy is regaining some momentum.
Worrying deflationary pressures in the world’s secondlargest economy appear to be slowly easing, though demand remains soft and a protracted property crisis is still weighing heavily on consumer and business confidence.
Persistent declines in factorygate prices and export prices, meanwhile, have added to tensions with China’s biggest trading partners. The consumer price index (CPI) grew 0.1% in March from a year earlier, against a 0.7% rise in February, which was the first gain in six months, data from the National Bureau of showed.
That compared with a 0.4% rise predicted by economists in a Reuters poll.
The CPI fell 1.0% monthonmonth, cooling from a 1% gain in February and
Statistics (NBS) worse than a 0.5% drop forecast by economists.
The producer price index (PPI) fell 2.8% in March from a year earlier, widening a 2.7% slide the previous month, and compared with a forecast 2.8% fall. Factorygate prices have been falling for a year and a half as firms cut selling prices to maintain sales and as commodity prices fell. On a monthonmonth basis, the PPI fell 0.1%.
In recent months, China has rolled out a raft of incentives to spur household spending, including easier car loan rules, but consumers stay cautious about bigticket purchases amid worries about the sputtering economy and the weak job market.