Jul 10, 2018 (China Knowledge) - China's June consumer inflation rose slightly year-on-year, a new high in three months. The latest data released by the National Bureau of Statistics (NBS) shows that China's June consumer price (CPI) rose 1.9% from a year earlier, in line with expectations, slightly higher than the 1.8% gain in May.
Its CPI year-on-year growth was however lower than 2% for the third consecutive month.
Among the major categories of goods and services, food, tobacco and alcohol rose by the least (0.8%) from a year earlier, affecting the CPI by about 0.25%.
The increase in consumer inflation in June was mainly driven by soaring health care, transportation and communication and residential prices, which rose 5.0%, 2.4% and 2.3%.
The Chinese government has set a 3% inflation target for 2018, but it faces increasing uncertainty in achieving that target due to the tit-for-tat tariffs between US and China that have cast doubts on the country's economic growth.
Meanwhile, the country's producer inflation raced to a six-month high in June, putting more pressure on the country's exports amid escalating trade tensions between US and China.
The producer price index (PPI), which is a leading indicator to determine if consumers pay more or less as producer are likely to pass on higher cost to consumer, rose 4.7% in June from a year earlier, higher than the expected 4.5% and the 4.1% increase in May, according to data from the NBS.
The increase was contributed by some of the major industries that include the oil and natural gas extraction industry, the ferrous metal smelting and calendering industry, the non-ferrous metal smelting and calendering industry, the chemical raw materials industry and chemical products manufacturing industry.
In terms of sub-items, oil prices remain the most important contributor to the producer inflation as in the previous month, rising by 4.5% month-on-month and 32.7% year-on-year, due to the continued rapid upward movement of international crude oil prices in May.
Copyright © 2018 www.chinaknowledge.com
Send feedback or comments to: firstname.lastname@example.org
For more news, financial weekly reports, business guides to China and other premium information, subscribe to China Knowledge today: www.chinaknowledge.com
To access our page on Bloomberg, type CKFI