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Rediff.com  » Business » China's September inflation hits 4-year low

China's September inflation hits 4-year low

By K J M Varma
October 15, 2014 10:41 IST
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A parade in BeijingInflation in China fell to 1.6 per cent in September, lowest in four years while the producer price index, which measures inflation at wholesale level, dropped 1.8 per cent year on year.

Growth in China's consumer inflation slowed than market expectation to 1.6 per cent in September, the lowest since January 2010, according to the official data released on Wednesday.

This is compared with an increase of two per cent registered in August, the National Bureau of Statistics said in a statement on its website.

On a monthly basis, the consumer price index rose 0.5 per cent last month, faster than August's 0.2-per cent increase, state-run Xinhua news agency reported.

The CPI grew 2.1 per cent year on year in the first nine month, well below the 3.5-per cent full-year control target set by the government.

But at the same time the PPI, which measures inflation at wholesale level, dropped 1.8 per cent year on year in September, the NBS said.

The PPI declined for the 31st straight month and in a faster pace than the previous month, marking existing pressures from slowing economic growth.

The PPI dropped 1.2 per cent year on year in August, 0.9 per cent year on year in July, 1.1 per cent in June, 1.4 per cent in May, 2 per cent in April and 2.3 per cent in March.

Factory prices of production materials went down 2.4 per cent in September, contributing 1.8 percentage points to the PPI drop, while factory prices for consumer goods gained 0.1 per cent.

In the first nine months, the country's PPI dropped 1.6 per cent year on year, the data showed.    

China is expected to come up with the Q3 figures of GDP amid speculation that it may miss the official target of 7.5 per cent this year.

Last year the economy registered 7.7 per cent growth.

Image: A parade in Beijing; Photograph: Reuters

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K J M Varma in Beijing
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