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China's April inflation exceeds forecast at 5.3%

CHINA'S inflation rate last month posted the first month-on-month drop this year as tightening policies took effect. However, the price growth was faster than the government's yearly target for a fourth month.

The Consumer Price Index, the main gauge of inflation, rose 5.3 percent from a year earlier in April, down 0.1 percentage point from the level in March, which was a 32-month high, the National Bureau of Statistics said today.

Food costs, the biggest constituent in the CPI basket, increased 11.5 percent year-on-year last month, compared with the growth of 11.7 percent in March, contributing to an easing CPI rise.

"The government's tightening efforts are starting to slow inflation," said Matthew Circosta, an economist at the Moody's Analytics. "But it was only ever so slightly."

Indeed, the rate in April was higher than the market forecast of around 5 percent, and dwarfed the government yearly target of 4 percent.

Growth of consumer prices in the first four months stood at 5.1 percent, the bureau said. To contain rising prices, China has lifted the benchmark interest rates twice this year, together with four reserve requirement ratio increases to soak up market liquidity.



 

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