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China's CPI falls 1.4% in May
(Xinhua)
Updated: 2009-06-10 10:31
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This marks the fourth consecutive monthly decline since the index dropped 1.6 percent in February, the first fall since October 2002. The decline was 0.1 percentage point lower than the April level. Food prices, which comprise a third of the CPI, dropped 0.6 percent, as pork prices continued to fall by 32 percent on oversupply and concerns that the A/H1N1 influenza virus was connected to pigs. Non-food prices fell 1.7 percent.
The core CPI, which excludes food and energy prices, dropped 1.3 percent year-on-year, said NBS. The bureau had noted in a statement on its website that grain prices rose by 0.8 percent in May, the fifth straight rise since January. "It needs further observation to see whether the grain price hike would have an impact on the CPI trend," said the statement. The May data was in line with market expectations, said Zhuang Jian, a senior economist with the Asian Development Bank. The slowly year-on-year decline in CPI last month had shown a more solid and stable recovery in China's economy, he said, forecasting that the CPI would turn positive before the end of this year. "With money supply and domestic demand growing, the downward trend in CPI will not last long," he told Xinhua. The Chinese government has set a full-year inflation target of 4 percent for 2009.
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