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October consumer prices rise 0.2% from a year earlier

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Producer price index extends three-year drop but moderates

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Authorities step up efforts to rein in price wars

(Recasts headline, paragraph 1, adds details throughout)

BEIJING, Nov 9 (Reuters) - China's producer price

deflation eased in October and consumer prices returned to

positive territory, data showed on Sunday, as the government

steps up efforts to curb overcapacity and cut-throat competition

among firms.

The producer price index fell 2.1% in October from a year

earlier, National Bureau of Statistics data showed, compared

with an expected 2.2% decline in a Reuters poll of economists.

The index has remained negative since October 2022 and dropped

2.3% in September.

Consumer prices edged up 0.2% from a year earlier, reversing

a two-month decline and beating the estimate for no change.

The October price figures indicate that government efforts

to rein in excessive competition have helped stabilise prices,

but lukewarm domestic demand and geopolitical tensions continue

to cloud the business outlook.

China's economic growth slowed to its weakest in a year in

the third quarter, and the youth unemployment rate remained

elevated despite a dip in September.

Policymakers have refrained from aggressive stimulus this

year, with the central bank keeping interest rates steady for

five months, partly due to resilient exports following a trade

truce with the United States.

China's economy is on track to meet the government's target

of around 5% growth this year, but producer deflation, as well

as downbeat factory activity and an expected contraction in

exports in October indicate waning growth momentum.

Chinese leaders have signalled a sharper shift towards

supporting consumption over the next five years, as limited

investment room and trade tensions have exposed vulnerabilities,

though measures may take time to yield results.

Compared with the previous month, CPI rose 0.2% in October

after rising 0.1% in September and compares with a forecast of

no change.

Core inflation, which excludes volatile prices of food and

fuel, was up 1.2% year-on-year in October, quickening from the

1% increase in September and hitting a 20-month high.

Food prices fell 2.9% year-on-year, after dropping 4.4% in

September.