One economist told CNBC ahead of the release that the improvements in China’s PPI will help support the country’s growth this year.
“This time round, China’s recovery momentum has been mainly driven by recovering PPI-related inflation,” said Betty Wang, an ANZ senior economist.
Wang said the bank expects China’s CPI to rise 1.2 percent from a year ago in June — easing from May — due to a drop in food prices, while PPI will edge up to 5.6 percent due to a rise in the commodity prices, said Wang.
The bank expects PPI inflation to moderate in upcoming months. ANZ also expects China’s growth momentum to moderate in the second half of the year from a better-than-expected first half due to government efforts in financial deleveraging.
Strong infrastructure investment in the first five months of the year, however, will help China secure its target 6.5 percent growth rate in 2017, she added.
Despite broad-based concerns about international trade, Wang said China faces greater economic risks internally.
Beijing is targeting consumer inflation at 3 percent this year, unchanged from 2016.