China’s October CPI rises 0.7% as producer prices post biggest gain in four years

China’s consumer price index rose 0.7% year over year in October, below the 0.8% expected by markets and down from September’s 0.9%, Forex Factory reported. The figures point to a slower annual pace of consumer inflation than in the previous month, as well as a miss against the forecast cited by the outlet.

Producer prices moved in the opposite direction: Chosun.com reported that they recorded their largest increase in four years. The report’s headline also said weak demand was limiting consumer-price growth. It did not provide a producer-price percentage in the headline, so no specific October PPI rate can be established from that report.

The result was different from the outlook published before the data. InvestingLive’s October inflation preview said the consumer price index was seen near 0.8% and producer prices were expected to be above 5%. Forex Factory subsequently reported a 0.7% CPI increase, below that preview’s approximate consumer-inflation forecast.

Together, the reports describe a divergence between the two price measures: consumer inflation was reported below expectations and September’s rate, while producer prices posted their strongest increase in four years, according to Chosun.com. The supplied headlines do not establish the exact PPI increase or provide further detail about the forces behind the reported movement. The consumer-price figures and market comparison are those reported by Forex Factory; the four-year producer-price comparison and weak-demand characterization are from Chosun.com.