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China CPI growth falls to 3.2% in Feb

Updated: 2012-03-09 10:51


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China CPI growth falls to 3.2% in Feb

BEIJING - China's inflation rose in February at its lowest pace in 20 months, providing more room for the government to stimulate growth in the world's second-largest economy.

The consumer price index (CPI), a main gauge of inflation, increased 3.2 percent year-on-year last month, the National Bureau of Statistics said Friday.

It eased from a 4.5-percent rise registered in January, during which shopping spree in the Chinese Lunar New Year holiday boosted retail prices.

With inflation pressures fading, it leaves Chinese policymakers with more room to further loosen the monetary policy so to shore up growth, said Teng Tai, chief economist at Minsheng Securities.

The pullback in February's CPI rise, along with continuous food price declines, indicates the government's inflation control target could be reachable this year, said Yuan Gangming, a researcher with Tsinghua University.

The Chinese government has cut the projected economic growth to 7.5 percent for this year and aims to keep the CPI increase to around 4 percent.

In the first two months, the country's CPI climbed 3.9 percent compared with the previous year. On a monthly basis, CPI dipped 0.1 percent in February, the NBS said.

The slower CPI growth in February, pared by a higher comparative base from last February, also results from a deceleration in food price growth.

Food prices, which account for nearly one-third of the weighting in the calculation of China's CPI, increased 6.2 percent last month from one year earlier. Food price growth slowed from January's 10.5 percent rise.

The price of pork, China's staple meat, jumped 15.9 percent year-on-year last month after surging 25 percent in January.