BEIJING: Chinese consumer prices rose 2 percent in August on-year, official data showed yesterday, inflation in the world’s second-largest economy slipping to a four-month low and remaining well below the government’s annual target.
China’s consumer price index (CPI) — a main gauge of inflation — also rose by 2.2 percent in the first eight months from the same period in 2013, the National Bureau of Statistics said in a statement. The result for August compared with an increase of 2.3 percent in July and was also lower than the median estimate of 2.2 percent in a survey.
The figures fall well short of the 3.5 percent annual inflation target set by the government. Moderate inflation can be a boon to consumption as it encourages consumers to buy before prices go up, while falling prices encourage shoppers to delay purchases and companies to put off investment, both of which can weigh on growth. The stable inflation figures came as worries have increased over the strength of China’s economic outlook, with the effects of steps taken earlier this year to prop up slowing growth waning and worries intensifying over the potential for a bust in the country’s property sector to upset the forecasts.
Authorities have since April introduced measures to boost the economy by giving tax breaks to small enterprises, targeted infrastructure outlays and incentives to encourage lending in rural areas and to small companies. The government on Monday announced that China’s trade surplus surged to a record $49.8bn in August as imports surprisingly fell and export growth slowed. The data came on the heels of other figures, including manufacturing activity surveys, showing continued weakness in the economy and spurring further expectations among economists that authorities will unveil new measures to boost growth.AFP
