China inflation slows to almost 5 year low in September

China's consumer inflation rate slowed to 1.6 percent in September from a year earlier on falling food costs, the lowest in almost five years, official data showed Wednesday.
The consumer price index (CPI), a main gauge of inflation, slowed from August's 2.0 percent expansion, and marked the lowest rate since January 2010, when it increased 1.5 percent on the year, the National Bureau of Statistics said in a statement. The index was far below the government's inflation target of 3.5 percent for this year. Food prices, which account for a third of the basket of goods in China's CPI calculation, rose 2.3 percent year-on-year in September, compared with 3.0 percent in August. The producer price index, a key gauge of inflation at the wholesale level, fell 1.8 percent in September from the year before, following the 1.2-percent drop in August. The producer price index shrank for the 31st straight month and at a faster pace than the previous month, indicating shrinking demand and rising production overcapacity amid slowing economic growth, state-run Xinhua News Agency said. Yu Qiumei, senior statistician of the bureau, attributed the decline in September to price dives in crude oil, refined oil and steel, according to Xinhua.