China’s Factory Inflation Slows as Manufacturing Stumbles; Food Prices Soar

China’s Factory Inflation Slows as Manufacturing Stumbles; Food Prices Soar
A fruit and vegetable stall owner uses a calculator to work out prices for a customer at a small market in central Beijing on July 7, 2011. David Gray/Reuters
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BEIJING–China’s factory inflation slowed in May as faltering manufacturing hit demand, reinforcing worries about cooling growth in the world’s second-largest economy, while a surge in food prices could add to consumer grievances about living costs.

The slowdown was driven by declines in industrial commodities prices and was in line with the downbeat factory activity seen in May. It also comes amid China’s worsening trade dispute with Washington.