Chinese Inflation Slows to Three-Month Low Amid Easing Oil Prices

China's factory-gate inflation slowed to its lowest in three months in July, while consumer price growth cooled further. The producer price index (PPI) rose 3.5% year-over-year in July, down from 4.1% in June, according to the National Bureau of Statistics.

The core consumer price index (CPI), which excludes food and energy prices, climbed 0.9% on a yearly basis. However, food prices fell 1.5%, while overall CPI edged down 0.1% from the previous month.

Analysts point to lower oil prices as a major factor contributing to the easing inflation. 'Lower oil prices, combined with weakening demand, caused both (consumer and producer price inflation) in July to come in below expectations,' said Zhaopeng Xing, ANZ's senior China strategist.