Fri 12th Nov- China's consumer prices rise at slower pace

The rise in October’s consumer price index, or CPI, for China- the world's biggest growing economy- compared with an increase of 5.2 percent in the 12 months through September, and was well below the 4.9 percent median forecast of five economists surveyed last week.
Annual consumer price inflation eased slightly in September, after gathering steam for five months in a row and hitting a seven-year high of 5.3 percent in July and August largely due to surging grain and vegetable prices.
“I think pressure for an immediate second rate hike is reduced, not just because of the CPI figure but because money supply growth was also less than expected,” said Deutsche Bank economist Jun Ma.
The high inflation was one factor behind the central bank’s decision last month to raise interest rates by 0.27 percentage point to 5.58 percent for one-year loans and 2.25 percent for one-year deposits.
That increase was China’s first in nine years, and marked its boldest step yet to cool heated economic growth. October’s CPI was flat from a month earlier, the National Bureau of Statistics said in a statement. China’s monthly data is not seasonally adjusted, making it difficult to assess underlying trends.
The CPI data came a day after China said the broad money supply at the end of October was up a slower-than-expected 13.5 percent from a year earlier, a sign that credit curbs in place since last year are still having an effect.
But the government also said that producer prices, the cost of goods at the factory gate, rose 8.4 percent in the year through October, the fastest pace since the 1997/98 Asian financial crisis.
Although goods like food and petrol have risen sharply in recent months, the prices of most manufactured items have fallen because of widespread overcapacity and fierce competition.