China CPI ticked up slightly from 0.1% yoy to 0.2% yoy in May, above expectation of 0.1% yoy. Core CPI, which excludes volatile food and energy prices, slowed from 0.7% yoy to 0.6% yoy.
Food price rose 1.0% yoy, up from prior month’s 0.4% yoy. However, price for industrial consumer products dropped -1.7% yoy, worse than April’s -1.5% yoy. On a month-on-month basis CPI dropped -0.2% mom, deeper than April’s -0.1% mom.
PPI dropped from -3.60% yoy to -4.6% yoy, below expectation of -3.9% yoy. That’s also the steepest decline in seven years since May 2016.
Dong Lijuan, an NBS statistician, said the consumer inflation picked up marginally with the gradual recovery in consumer demand, while the fall in factory-gate prices was affected by declining international commodity prices, weak demand for industrial products at both home and abroad, as well as a high comparison base in the previous year.
