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China’s consumer inflation edged up to 1.5 per cent in April compared with a year ago, missing market expectations and adding to concerns about burgeoning deflationary pressures which are likely to lead to more policy easing.
Analysts polled by Reuters had predicted the consumer price index (CPI) would pick up to 1.6 per cent, compared with 1.4 per cent posted the prior month.
The producer price index remained in negative territory for the 37th consecutive month, falling 4.6 per cent, the National Bureau of Statistics said on Saturday, extending factory deflation to more than three years.
The market had expected producer prices to fall 4.4 per cent on an annual basis after a decline of 4.6 per cent in March.
Wary about following in the footsteps of Japan, where a decade-long fall in consumer prices has dragged on economic growth, senior Chinese officials have said they were keeping a close eye on deflationary pressures.
They have said that the 1 per cent mark in the consumer price index is a red line that would raise flags if inflation dropped below that.
