China's May inflation rate to stay flat: report

BEIJING -- China's inflation rate in May is likely to stay flat from April due to milder increases in food prices and a lower base of comparison, a latest research by Bank of Communications (BOCOM) showed.

The consumer price index (CPI), a main gauge of inflation, will grow 2.3 percent year on year in May, level with that in April, according to the BOCOM research report.

That will put the inflation rate at its highest level since July 2014 for a fourth month.

Food prices, which account for a fifth of CPI calculation, will post an increase of between 7 and 7.4 percent, slightly milder than the growth in April, the report said.

Pork prices have been elevated by short supply, but the report forecast that frozen pork reserves and subsidies to sellers will mitigate increases.

The warmer weather is expected to ease pressure on vegetables, which saw an average price drop of 13 percent in the first 20 days of May from a month earlier.

However, a lower base of comparison this month means the year-on-year CPI growth will hold steady, the report said.

Despite little inflationary pressure for now, future consumer prices will likely climb up due to stabilizing oil prices on international markets and expanding monetary supply in the country, the report said.