Financial News: China Inflation Steady At 1.2%; PPI Inflation Accelerates

China Inflation Steady At 1.2%; PPI Inflation Accelerates On Energy Prices

(RTTNews) - China's consumer prices logged a steady growth in May and producer price inflation accelerated to its highest level in nearly four years on higher energy costs, official data showed Wednesday.

Consumer prices increased 1.2 percent year-on-year in May, the same rate as seen in April, the National Bureau of Statistics said. This was slightly weaker than forecast of 1.3 percent.

Core inflation that excludes food and energy slowed to 1.1 percent from 1.2 percent in the previous month.

Food prices dropped 1.7 percent in May as pork prices plunged 16.1 percent from the last year. However, higher energy prices offset the decline in food prices.

On a monthly basis, consumer prices dropped 0.1 percent in May. Economists had forecast a monthly fall of 0.2 percent.

ING economist Lynn Song said food and property prices are helping suppress headline inflation for now. But rising prices more broadly suggest that China is moving from deflation into a low inflation environment.

The deepening integration of AI artificial intelligence across various fields and surging computing demand pushed up prices across non-ferrous metals, electrical machinery and computer hardware, NBS Chief Statistician Dong Lijuan said.

Non-ferrous metal prices grew sharply by 36.5 percent and gasoline prices for consumers climbed 23.5 percent.

Producer prices advanced 3.9 percent on a yearly basis in May after climbing 2.8 percent in April, the NBS said in a separate communique. The rate came in line with expectations and also marked the fastest since mid-2022.

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