China's inflation eased marginally in July, as food prices climbed at a slower pace, giving space for monetary policy manoeuvre.
Inflation slowed to 1.8 percent in July from 1.9 percent in June, the National Bureau of Statistics reported Tuesday. The annual rate matched economists' expectations.
A similar rate was last seen in January and this was the weakest since December 2015, when inflation was 1.6 percent. Inflation continues to remain below the full-year target of 3 percent.
Month-on-month, consumer prices gained 0.2 percent versus a 0.1 percent fall in June. This was the first increase in five months.
Food inflation fell to 3.3 percent from 4.6 percent, while non-food inflation rose to 1.4 percent from 1.2 percent.
Inflation is likely to edge up in the coming months, though not to a level high enough to become a major concern for Chinese policymakers, who will continue to focus on medium-term risks, said Julian Evans-Pritchard at Capital Economics.
Policymakers are likely to focus their attention on more pressing issues, such as addressing credit risks and structural imbalances, the economist added.
The People's Bank of China said last week the bank will maintain the yuan exchange rate basically stable, while continuing the currency market reforms.
Another report from the NBS showed that producer prices slid 1.7 percent from a year ago, much slower than the 2.6 percent decrease seen in June.
The PPI has been falling for more than four years now. Prices were expected to decline 2 percent. However, producer prices moved up 0.2 percent month-over-month in July.
by RTT Staff Writer
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