China's CPI eases to 4 percent in October

(Xinhua/China Daily)
Updated: 2008-11-11 10:32

Vendors weigh cabbages in a market in Beijing, November 11, 2008. China's annual consumer price inflation fell to a 17-month low of 4.0 percent in October from 4.6 percent in September, the National Bureau of Statistics said on Tuesday. [Agencies]

China's consumer price index (CPI), the main gauge of inflation, rose 4 percent in October from a year earlier, the National Bureau of Statistics said on Tuesday.

The figure, compared with 4.6 percent in September, 4.9 percent in August, 6.3 percent in July, 7.1 percent in June, and a nearly 12-year-high of 8.7 percent in February, was broadly in line with most forecasts.

The decelerating pressure of inflationary pressure in China, experts say, is in keeping with a worldwide slump of commodity prices, and makes the door open for China's central bank, the People's Bank of China, to cut interest rates further before the year-end.

The decline reduces the danger of a new spike in inflation as the government launches a 4 trillion yuan ($586 billion) package announced Sunday to revive China's slowing economic growth.

And the producer price index (PPI) grew 6.6 percent in October - the slowest pace in eight months - giving the government more leeway to boost the economy.

The main gauge of factory-gate inflation was released Monday amid gloomy economic prospects and a worldwide slide in energy and raw material prices.

The PPI peaked at 10.1 percent in August, a 12-year high, and has been declining since then, the National Bureau of Statistics said.

The nation's economic growth slowed to 9 percent year-on-year in the third quarter, the lowest in five years. It grew at 10.1 percent in the second quarter and 10.6 percent in the first quarter.

The central bank has cut borrowing costs thrice over the past two months. The State Council on Sunday unveiled a 4 trillion yuan ($586 billion) stimulus package and said it would adopt "active" fiscal and "moderately loose" monetary policies.