China’s inflation climbed at the fastest pace in nine months in October and producer price inflation exceeded expectations as measures taken to curb pollution raised commodity prices.
Inflation rose to 1.9 percent in October from 1.6 percent in September, data from the National Bureau of Statistics showed Thursday.
Economists had forecast the rate to climb moderately to 1.8 percent. This was the highest rate since January, when inflation was 2.5 percent.
Nonetheless, inflation was well below the government’s full year target of around 3 percent.
Data showed that food prices dropped 0.4 percent but slower than September’s 1.4 percent decrease. At the same time, non-food inflation held steady at 2.4 percent.
On a monthly basis, consumer prices edged up 0.1 percent, following September’s 0.5 percent increase.
Another report from NBS revealed that producer price inflation held steady at 6.9 percent in October, while it was forecast to ease to 6.6 percent. Monthly inflation slowed to 0.7 percent from 1 percent a month ago.
Price pressures may remain strong for a while longer as the anti-pollution campaign keeps commodity prices elevated and this feeds through into core inflation, Julian Evans-Pritchard, an economist at Capital Economics, said.
But with the economy likely to slow in the coming quarters and commodity prices set for an eventual correction, price pressures should start to ease before they trigger a policy response, the economist added.
The material has been provided by InstaForex Company – www.instaforex.com