China’s consumer inflation misses expectations amid calls to fight ‘deflationary pressure’

China’s consumer price growth fell short of expectations in August, extending over a year of economic weakness, with a former central bank governor calling for urgent measures to combat deflation, which poses a growing threat to the economic outlook.

The consumer price index (CPI), a key gauge of inflation, grew by 0.6 per cent year on year in August, compared to an increase of 0.5 per cent in July, the National Bureau of Statistics (NBS) said on Monday.

The reading fell short of the expected 0.71 per cent growth projected by economists polled by Chinese financial data provider Wind.

Meanwhile, China’s producer price index (PPI) – which measures the cost of goods at the factory gate – slipped by 1.8 per cent last month, falling for the 23rd consecutive month, compared with a fall of 0.8 per cent in July.

The reading fell short of the expected 1.4 per cent decrease projected by Wind.