SHANGHAI: China's consumer price index rose 6.1 percent in September from a year earlier, the government said Friday, slowing marginally from an annual rise of 6.2 percent in August.
Stubbornly high inflation persisted despite government moves to rein in soaring food and housing prices, which Beijing fears could cause social unrest as citizens face higher living costs.
Inflation hit a more than three-year high of 6.5 percent in July.
China has already implemented a number of policies over the past year to try to slow the rise in prices, including restricting the amount of money banks can lend and hiking interest rates five times since October last year.
"This confirms inflation is following a downward trend in the fourth quarter. But in the long term, inflation will stay at high levels," Zhang Zhiwei, Hong Kong-based economist with Nomura Securities, told AFP.
The slight slowdown in inflation in September is unlikely to convince the government to radically loosen its tight credit policy, at least in the short-term, analysts said.
"Tightening of monetary policy and growth moderation have ensured that inflation is now in retreat," Alistair Thornton, China analyst at Global Economics, said in a report.
But he added: "For the moment, we remain in policy stasis -- no more tightening, but no real loosening."
The key food component of inflation rose 13.4 percent year-on-year in September, unchanged from the August level, the National Bureau of Statistics said in a statement.
Chinese Premier Wen Jiabao said just last month that he "cannot relax" due to soaring prices in China that have led to steep rises in the cost of food, as he vowed to step up the fight against inflation.
Food prices are of particular concern, as they affect the daily lives of everyone in the country, with foodstuffs accounting for more than one-third of the monthly spending of the average Chinese consumer.
However, the producer price index -- a measure of inflation at the wholesale level -- rose 6.5 percent year on year in September, slowing from a 7.3 percent rise in August, the bureau said.
The government had originally set a target of four percent for overall inflation in 2011, but officials have already admitted it will be difficult to keep CPI within that target.
Nomura Securities forecasts that China's inflation will be around 5.0 percent for all of 2011.
Chinese investors reacted negatively to the announcement, which came shortly after the market opened. The key Shanghai stock index was down 0.60 percent in morning trade, due to concerns that inflation remained relatively high, dealers said.
Comments
Comments are closed for this article.