China consumer inflation rises to 1.4% in June: govt

[BEIJING] Consumer inflation in China rose to 1.4 per cent in June, authorities said Thursday, as downward pressure on prices abated in the world's second-largest economy.

The reading for the consumer price index, a main gauge of inflation, released by the National Bureau of Statistics was higher than May's 1.2 per cent.

Moderate inflation can be a boon to consumption as it pushes consumers to buy before prices go up, while falling prices encourage shoppers to delay purchases and companies to put off investment, both of which can hurt growth.

Inflation has been subdued in China as economic growth slows and commodity prices have fallen, with some economists raising the threat of deflation - a debilitating and sustained fall in prices.

China's economy expanded 7.4 per cent last year, its slowest pace in 24 years.

The producer price index - a measure of costs for goods at the factory gate and a leading indicator of the trend for CPI - declined 4.8 per cent in June, the NBS said, worsening from 4.6 per cent in May and the 40th consecutive fall.

AFP