Deflation can deceive

The current fall of consumer and producer prices in China can help lower cost for businesses and encourage consumers to spend.

More important, it gives Chinese policymakers greater room for maneuver to stoke a fledging economic recovery without triggering serious inflation.

China's consumer prices dropped 1.5 percent in April from a year earlier, after falling 1.2 percent in March. Meanwhile, producer prices fell 6.6 percent year on year.