BEIJING • China's factory-gate inflation cooled for a third straight month last month amid ebbing domestic demand, pointing to more pressure on the world's second-biggest economy as it remains locked in an intensifying trade war with the United States.

Consumer inflation, in contrast, picked up slightly last month from the previous month, led mainly by higher food prices, official data showed yesterday.

The producer price index (PPI), a gauge of industrial profitability, rose 3.6 per cent last month from a year earlier, compared with a 4.1 per cent increase in August, according to data released by the National Statistics Bureau yesterday.

On a monthly basis, the PPI picked up to 0.6 per cent from 0.4 per cent in August.

Analysts polled by Reuters had expected last month's producer inflation would cool to 3.5 per cent as both external and domestic demand weakened.

Profit growth at China's industrial firms slowed to a five-month low in August, fanning concerns about faltering domestic demand.

Prices of raw materials rose 7.3 per cent last month from a year earlier, down from a 7.8 per cent increase in August, according to the statistics bureau.

The consumer price index rose 2.5 per cent from a year earlier, accelerating from August's 2.3 per cent gain. It still remained comfortably below China's inflation goal of 3 per cent for this year.

REUTERS