China's inflation cooled in May, with consumer prices growing at a rate unchanged from the previous month, and the rise of factory-gate prices slowing to 6.4 percent, as measures to ensure supply against COVID-19 disruptions take effect, official data showed Friday.

 

The consumer price index (CPI), a main gauge of inflation, rose 2.1 percent year on year last month, said the National Bureau of Statistics (NBS). On a monthly basis, the CPI edged down 0.2 percent, compared to the 0.4-percent uptick in April.

 

Food prices reversed the 0.9-percent gain in April to fall 1.3 percent month-on-month, mainly weighed down by the 15-percent price drop in fresh vegetables with market supply boosted and logistics smoothed, according to the data.

 

The price of pork, a staple meat in China, registered a year-on-year dive of 21.1 percent, but increased 5.2 percent over April. Hog production has gradually tempered, meanwhile the stockpiling of pork to replenish state reserves continues, noted Dong Lijuan, a senior statistician with the NBS.

 

Driven by global food price hikes, the prices of flour, grain products and plant-based oils ticked up by 0.8 percent, 0.8 percent and 0.7 percent over the previous month, said Dong.

 

The prices of gasoline, diesel, and liquefied petroleum gas went up by 27.6 percent, 30.1 percent, and 26.9 percent year on year, respectively.

 

China has vowed to leave no single grain unreaped during this year's summer harvest and keep the supply of coal-fired power stable in order to underpin price stability. By Monday, the country had harvested around 55 percent of its winter wheat, beating last year's halfway date by two days.

 

To further ensure energy security, the country also plans to launch a number of new wind, solar and coal-fired power projects this year and enhance storage for resources like coal and crude oil.

 

The core CPI, which excludes food and energy prices, gained 0.9 percent year on year last month, unchanged from April.

 

Friday's data also showed that China's producer price index (PPI), which measures costs for goods at the factory gate, rose 6.4 percent year on year in May.

 

The figure moderated from the 8 percent year-on-year increase registered in April. On a monthly basis, China's PPI gained 0.1 percent, compared with the 0.6 percent increase in April.

 

Both the monthly and year-on-year growth rates of PPI continued to narrow thanks to the effective coordination of epidemic control, economic and social development, and measures to ensure smooth and stable industrial and supply chains, Dong said.

 

In June and beyond, analysts warn of potential impact on prices, including from sporadic COVID-19 resurgences, regional extreme weather conditions as well as high global fuel and raw material prices.

 

The CPI could stay flat or dip in June, while the PPI may ease further at a slower rate, squeezing the gap between consumer and factory-gate prices, said Deng Zhichao, an analyst at Zhixin Investment Research Institute.