(Yicai) June 12 -- China consumer inflation edged up for the fourth straight month in May, while factory gate prices fell for the 20th month in a row but by the least in more than a year.

The consumer price index rose 0.3 percent last month from a year earlier, according to data released by the National Bureau of Statistics today. The CPI gained 0.3 percent in April, 0.1 percent in March, and 0.7 percent in February.

The core CPI, which excludes food and energy prices, rose 0.6 percent, said Dong Lijuan, a chief statistician at the NBS.

Food prices retreated 2 percent from a year ago and 0.7 percentage point from the month before, dragging down the CPI by 0.4 point, Dong noted. Non-food prices rose 0.8 percent, 0.1 point slower than in April, boosting the CPI by 0.7 point, she added.

The impact of food prices on the CPI was reduced last month, as the cost of vegetables fell as supplies rose, offsetting higher pork prices, China International Capital Corporation said in a report. Prices of services, transportation, and energy prices surged further as a result of consumption over the Labor Day holiday, the report added.

CPI growth is expected to fluctuate around zero this quarter, with a rebound likely to happen in the second half because of restrained increases in the cost of pork, Wu Ge, chief economist at Changjiang Securities, told Yicai.

PPI

The producer price index fell 1.4 percent in May from a year earlier, the slowest rate since February 2023, per the NBS, after declining by 2.5 percent in April and 2.8 percent in March.

The deceleration is mainly due to the rising cost of some international commodities and the improved supply-and-demand relationship in the Chinese market for industrial goods, according to Dong.

Prices of China’s industrial goods will likely continue to improve, said Zhou Maohua, a macroeconomic researcher in the financial markets department of China Everbright Bank.

Domestic consumption and demand have much room to pick up, and the industrial sector is also proactively making adjustments to optimize supply and demand, Zhou noted, adding that the decline in PPI will continue to slow.

Editors: Dou Shicong, Futura Costaglione