China consumer inflation pick up continues in March, easing deflation worries

A woman choosing vegetables at a supermarket in Shanghai, China, in this March 10, 2016 file photo.
A woman choosing vegetables at a supermarket in Shanghai, China, in this March 10, 2016 file photo. PHOTO: REUTERS

BEIJING (BLOOMBERG) - China's consumer prices remained buoyant last month on rising food prices.

The consumer-price index was at 2.3 per cent in March from a year earlier, compared to 2.3 per cent in February and the 2.4 per cent median estimate of economists surveyed by Bloomberg. Producer price declines also narrowed to 4.3 per cent from a drop of 4.9 per cent in February.

The stronger inflation, though mainly driven by food prices, may extend the People's Bank of China's easing pause. Deflation pressures have also eased as a property recovery helps demand and after commodity prices rebounded.

"Given the upcoming stabilization of real economic activity, ongoing rebound in property sales and prices, and the recent jump in headline CPI, we think policy easing momentum has likely peaked in the near term," UBS Group AG economists wrote in a report ahead of the release.