China Inflation Eases to Three-Month Low in July

China's producer price inflation eased to its weakest in three months in July, while consumer inflation also cooled down. The country's producer price index (PPI) rose by 3.5% year-over-year in July, lower than the expected 3.8%, according to data released on Sunday.

The core consumer price index (CPI), which excludes volatile costs for food and energy, increased by 0.9% from a year earlier, while food prices dropped 1.5%. From the previous month, CPI edged down 0.1%, compared with an expected 0.2% gain.

Zhaopeng Xing, ANZ's senior China strategist, attributed the slower inflation to lower oil prices and soft domestic demand. He noted that oil price trends remain uncertain, which means their impact on inflation is also likely to be uncertain.