China’s Inflation in Line, Up 2.3%

Inflationary pressure in June eased slightly in China, giving policy makers more room to employ targeted fiscal and monetary measures in their bid to prop up economic growth.

China’s consumer-price index rose 2.3% in June from a year earlier compared with a 2.5% year-over-year rise in May, the National Bureau of Statistics said Wednesday. The gauge of inflation remains below Beijing’s annual target of 3.5% year for 2014 and slightly undershot the median 2.4% gain forecast by a poll of 21 economists by The Wall Street Journal.

“Inflation isn’t really going anywhere,” said HSBC HSBA.LN -1.46% analyst John Chua. “This probably gives Beijing more policy flexibility. They don’t worry about the economy running at full capacity.”  The world’s second-largest economy saw its slowest growth in 18 months during the first quarter, expanding by 7.4% year on year, compared with 7.7% in the fourth quarter of 2013.

WSJ

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