China Inflation September 2016


China: Inflation rises in September

October 14, 2016

In September, consumer prices rose 0.7% from the previous month, up from August’s 0.1% increase. The reading, which marked a seven-month high, mainly reflected a sharp increase in prices for education, culture and recreation as well as for food, particularly fresh vegetables, tobacco and liquors.

Inflation rose from August’s seven-month low of 1.3% to 1.9% in September. The print was above the 1.6% that market analysts had expected. Annual average growth in consumer prices stabilized at August’s 1.8% in September. As a result, inflation is well below the government’s 3.0% target for the year.

Meanwhile, the producer price index grew for the first time in nearly six years in September, expanding a mild 0.1% from the same month last year. The print contrasted both August’s 0.8% fall and the 0.3% drop that the markets had expected. The annual average variation of the producer price index decreased from August’s minus 4.1% to minus 3.6% in September, which represented the highest reading since June 2016.

FocusEconomics Consensus Forecast participants expect that inflation will average 2.0% in 2016, which is unchanged from last month’s estimate. In 2017, the panel sees inflation stable at 2.0%. Meanwhile, the panel expects producer prices to decline 2.8% in 2016, which is up 0.4 percentage points from last month’s projection. In 2017, panelists see producer prices falling 1.3%.

Author:, Economist

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China Inflation Chart

China Inflation September 2016

Note: Year-on-year and annual average variation of consumer price index in %.
Source: National Bureau of Statistics of China (NBS).

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