Key facts
- China's producer price index rose 3.5% year-on-year in July, slowing from 4.1% in June.
- The July producer price increase missed economists' expectations of 3.8%.
- Consumer price inflation also cooled, rising 0.5% year-on-year in July, down from 1% in June.
- Core consumer price inflation, excluding food and energy, rose 0.8% year-on-year.
- Producer prices fell 3.6% year-on-year in July, matching June's low.
China's producer price inflation eased more than expected in July to its weakest in three months, while consumer inflation also cooled. The producer price index rose 3.5% from a year earlier, down from 4.1% in June and below economists' expectations of 3.8%. The consumer price index (CPI) rose 0.5% year-on-year, down from 1% in June and below the expected 0.8% rise. On a monthly basis, CPI fell 0.1%, contrasting with expectations of a 0.2% gain. However, producer prices retreated 3.6% year-on-year, matching June's low and indicating persistent deflationary pressures. Core inflation, excluding volatile food and energy, rose 0.8% year-on-year, reaching its highest level in 17 months, suggesting growing momentum in domestic demand, particularly in services.