China’s consumer prices broke a three-month fall to increase marginally in May, even as headwinds slow a post-COVID recovery amid market expectations for stimulus measures, reports Nikkei Asia. The consumer price index rose 0.2% from a year earlier, the National Bureau of Statistics reported Friday. An increase in food and services prices led to the uptick from 0.1% in April. But these were offset by a fall in transportation and telecommunication prices, reflecting subdued demand for travel despite the weeklong Labor Day holiday.
“Consumer price inflation edged up but remained depressed,” Julian Evans-Pritchard, head of China Economics at UK-based Capital Economics wrote in a note on Friday. “Core inflation slipped slightly, suggesting that the immediate inflationary impact of reopening was easing last month.”
China’s factory gate inflation, meanwhile, declined with the official producer price index contracting 4.6%, driven partly by raw materials and lower commodities prices including crude oil. The PPI has been sliding from its recent peak in October 2021. Friday’s inflation data reflect an unsteady recovery, with six state lenders cutting deposit rates on Thursday.