Chinese inflation data comes up short

Susan Watts/NY Daily News Archive via Getty ImagesHe Pingping – the shortest man in the world.

Chinese consumer and producer price inflation both undershot economist expectations in March, largely reflecting the unwinding of temporary impacts caused by Lunar New Year celebrations.

Consumer price inflation (CPI) fell 1.1% over the month, far larger than the 0.5% decline expected, leaving the increase on a year earlier at 2.1%.

Both food and non-food inflation increased by 2.1% over the year.

The annual rate was well below the 2.9% level reported in February and forecasts for a smaller decrease to 2.6%.

The steep monthly decline reflected the unwinding of temporary price increases during Lunar New Year holidays in mid-February.

Producer price inflation (PPI), also known as factory gate inflation, also moderated, dropping by 0.2% from February.

That left the annual increase at 3.1%, the weakest level since October 2016.

Economists were looking for an annual increase of 3.2%, down from 3.7% in February.

As a major exporter of finished goods, the deceleration in PPI may have ramifications for global inflationary pressures in the months ahead.

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