Policy: Economy

China's inflation picks up on rise in food costs

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Photo - Chinese people eat their lunch next to a wall painted with a window and flowers in Beijing, China Tuesday, June 10, 2014. Higher food prices have pushed China's inflation to a five-month high of 2.5 percent. Data released Tuesday showed consumer inflation in May picked up from the previous month's 1.8 percent. The increase was driven by a 4.1 percent rise in food prices. (AP Photo/Andy Wong)
Chinese people eat their lunch next to a wall painted with a window and flowers in Beijing, China Tuesday, June 10, 2014. Higher food prices have pushed China's inflation to a five-month high of 2.5 percent. Data released Tuesday showed consumer inflation in May picked up from the previous month's 1.8 percent. The increase was driven by a 4.1 percent rise in food prices. (AP Photo/Andy Wong)
News,Business,China,Economy

BEIJING (AP) — China's inflation rose to a five-month high of 2.5 percent in May, driven by higher food prices, government data showed Tuesday.

Inflation still is below the ruling Communist Party's 3.5 percent target for the year, leaving room for interest rate cuts or other measures to stimulate the slowing economy if needed.

May inflation was up from the previous month's 1.8 percent, boosted by a 4.1 percent rise in food prices.

"We don't expect inflation to get out of hand this year," said Julian Evans-Pritchard of Capital Economics in a report.

Economic growth slowed to 7.4 percent in the three months ended March 31 from the previous quarter's 7.7 percent.

Other indicators suggest growth might slow still further in the current quarter.

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