Article by ForexTime
Consumer prices in China rose 1.6 per cent in September from a year earlier, easing from a 2 per cent pace of gains in August and below expectations for a 1.8 per cent increase. Producer prices fell 5.9 per cent from a year ago, in line with expectations and extending their downtrend to a 43rd straight month.
The data today would likely put pressure on the Chinese central bank to ease policy further. Most economists believe more stimulus is needed for China to reach its growth target of about 7 percent this year.
Asian stock markets fell after the inflation data. The Shanghai Composite and the Shenzhen Composite were each off 0.2 per cent while Hong Kong’s Hang Seng was down 0.7 per cent. Japan’s Nikkei slid 2 per cent while Australia’s S&P/ASX 200 dropped 0.3 per cent.
Today’s inflation data comes after Chinese trade data on Tuesday raised concerns about slowing growth in the world’s second largest economy.
Although a 3.7 per cent drop in exports in dollar terms in the year to September was not as bad as expected, news of a 20.4 per cent slide in imports set alarm bells ringing.
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