Inflation data points to China stimulus

Hong Kong

CHINA is increasingly likely to take new action to bolster growth, economists said, after figures released on Friday showed that inflation in the country remains near its lowest levels in five years.

Sluggish economic growth and falling prices for oil and other key commodities are resulting in weakening inflation in some of the world's biggest economies. On Wednesday, data from the eurozone highlighted the risk of deflation after prices fell 0.2 per cent in December, turning negative for the first time since 2009, during the global financial crisis.

In China, prices are falling because of weak domestic demand and the downturn in commodity markets. For example, prices…