China’s consumer price inflation rose less than expected in March, flattening out after a four-month strengthening trend, but wholesale prices remained stubbornly in deflation.
Consumer prices in March rose 2.3 percent, below a median forecast of 2.5 percent in a Reuters poll but equal to February’s increase of 2.3 percent. Although the prior month’s figure represented the fastest rise in more than a year, the increase was driven largely by sharp gains in food prices following an unexpectedly harsh winter.
Economists have been watching closely to see how inflation evolves in China this year following a prolonged easing campaign by the central bank beginning in late 2014, which has boosted credit, but has yet to result in substantial price increases.
Producer prices fell 4.3 percent in March, extending their decline to a full four years, but at a slower rate than forecasts of a 4.6 percent decline. Falling commodity prices and overcapacity in key industrial sectors have helped mire producer prices in a lengthy slump, although declines have eased in recent months.