China May economic data complicates future policymaking

Economic data for May released Friday showed that China was eyeing rising inflation and slowing economic growth, indicative of what the "the most complicated year" meant for the country's economy.

Experts said the mixed bag of economic data would make it difficult for China's policymakers in the coming months.

China's consumer price index (CPI), a main gauge of inflation, rose in May to 3.1 percent, the highest since November 2008, according to figures released by the National Bureau of Statistics (NBS) Friday.

The NBS also reported that growth of industrial value-added output slowed to 16.5 percent in May from 17.8 percent in April.

Urban fixed assets investment for the first five months rose 25.9 percent year on year, 0.2 percentage points down from the first four months.

INFLATION QUICKENS

The 3.1 percent CPI growth was up 0.3 percentage points from April's rise of 2.8 percent. In the first five months, China's CPI rose 2.5 percent year on year.

The May figure exceeded the government's year-average target of 3 percent set in March.

The producer price index (PPI), a major measure of inflation at the wholesale level, rose 7.1 percent year on year in May, up 0.3 percentage points from April's 6.8 percent.

In May, the CPI in China's urban areas increased 2.9 percent and in rural regions by 3.3 percent. Food prices, which accounted for about a third of the weighting in calculating the CPI, rose 6.1 percent.

China's inflation has stood above 2.25 percent, the one-year deposit interest rate set by the government, for four consecutive months, which ignited growing expectations of interests rate hikes.

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