China’s consumer-price index grew 2% in August year on year, reflecting a rise in consumer prices even as the producer-price index fell 5.9% for the period, Bloomberg reported, citing figures from the National Bureau of Statistics. CPI inflation is now higher than the one-year benchmark deposit rate, crimping real interest rates for savers while factory deflation pushes up real borrowing costs for the industrial sector. The pickup in CPI was due to surges in pork and vegetable prices, Yu Qiumei, senior statistician at NBS said in a statement after the data. Food prices were up 3.7% in August from a year earlier as pork prices increased 19.6% and vegetable prices rose 15.9%.
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