China Jan inflation comes in at 0.8%, missing forecasts

[BEIJING] China's consumer inflation slowed to a worse-than-expected rate of 0.8 per cent in January, reinforcing signs of persistent weakness in the economy and broadening the scope for further stimulus steps by the central bank to ward off deflationary risks.

Analysts polled by Reuters had expected annual consumer inflation to be 1.0 per cent in January, compared with 1.5 per cent in December.

The producer price index also missed forecasts, dropping 4.3 per cent, the National Bureau of Statistics said on Tuesday, its 35th consecutive monthly decline, as sluggish demand curbed the pricing power of companies.

The market had expected a 3.8 per cent fall in producer prices after a drop of 3.3 per cent in December.

Falling global energy and materials prices have weighed on China's factory prices, and to a lesser extent, consumer prices.

REUTERS