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Reports on PPI in September, CPI in trade war with US



China's consumer inflation rose 2.5% yoy in September, 0.7% higher than in August, government data released Tuesday.

percent rise in August, the National Bureau of Statistics reported. A Reuters poll showed that analysts expect PPI to increase by 3.5 percent over the previous year. The PPI rose 0.6 percent month-on-month.

The Consumer Price Index (CPI) – a measure of the price of goods and services – was in line with analysts' expectations, according to a Reuters survey. This figure was also below the annual target of 3% of policy makers.

Gains in the CPI were helped by a rise in food prices due to adverse weather and an increase in demand due to the festive season of the Golden Week, the bureau said in

In retaliation for Washington's increased duties on Chinese imports, Beijing also imposed tariffs some American goods – but the impact of the Chinese movement seems limited so far.

"Tariffs will drive up inflationary prices, but on the other hand, China still has overcapacity, which means that demand for goods and services is not as strong," said Chi Lo, senior economist at BNP Paribas Asset Management.

"The passage of tariffs on domestic prices will be limited," Lo told CNBC's "Squawk Box" on Tuesday.

The Chinese central bank is generally expected to adjust monetary policy to support slowed growth. China's official growth target this year is 6.5 percent.

Over the weekend, Governor of the People's Bank of China, Yi Gang, said he saw "plenty of room for adjustment" in interest rates and the bank's reserve requirement ratio due to significant downside risks from the bilateral trade

At the beginning of this week, the central bank in This year, for the fourth time, banks' reserves have been cut – a measure aimed at increasing liquidity in the system.

– Reuters contributed to this report.


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