China's inflation eases, giving room for stimulus

November 8, 2012

(AP) China's inflation eased further in October as increases in food prices slowed, giving Beijing more room to stimulate its economy.

The government said Friday that consumer prices rose 1.7 percent, down from the previous month's 1.9 percent. Food prices rose 1.8 percent, down from September's 2.5 percent.

Inflation was a pressing issue for Chinese leaders last year, when prices were rising by double digits. The change has given Beijing more room to cut interest rates or launch other stimulus measures to shore up slowing economic growth if needed.

Forecasters say the economy appears to be rebounding from its deepest slump since the 2008 global crisis but the recovery is likely to be gradual and weak.

Associated Press