Consumer inflation in China fell to 1.2 percent in May, authorities said Tuesday, as downward pressure on prices intensifies in the world`s second-largest economy.
The reading for the consumer price index, a main gauge of inflation, released by the National Bureau of Statistics was lower than April`s 1.5 percent.
Moderate inflation can be a boon to consumption as it pushes consumers to buy before prices go up, while falling prices encourage shoppers to delay purchases and companies to put off investment, both of which can hurt growth.
Inflation has been subdued in China as economic growth slows and commodity prices have fallen, with some economists expressing worries of impending deflation. China`s economy expanded 7.4 percent last year, its slowest pace in 24 years.
The producer price index -- a measure of costs for goods at the factory gate and a leading indicator of the trend for CPI -- declined 4.6 percent in May, the NBS said, the same as in April and the 39th consecutive fall.
