Investing.com-- Chinese consumer price index inflation shrank in October as spending showed little signs of improving, while producer inflation also contracted as Beijing ramped up its stimulus efforts to support the economy.
CPI inflation rose 0.3% year-on-year in October, in line with expectations, but slowing from the 0.4% increase seen in September. CPI shrank 0.3% on a monthly basis, data released over the weekend showed.
The CPI reading was its weakest since July, and showed that consumer spending was seeing little improvement even as Beijing rolled out a slew of major stimulus measures over the past month.
China’s National People’s Congress on Friday approved 10 trillion yuan ($1.6 trillion) in increased fiscal spending to boost the economy, although it was doubtful whether the measure would help spur an immediate improvement in economic activity and private spending. Investors were also underwhelmed by a lack of targeted measures at shoring up private spending.
Weakness in China’s manufacturing sector persisted, with producer price index inflation shrinking 2.9% in October, worse than expectations for a drop of 2.5% and shrinking further from the 2.8% seen in the prior month. The PPI reading also marked its 25th consecutive month of contraction.
Factory prices have been on an extended slump amid weak local demand and sluggish capital investment in the sector.