* October CPI rises 3.2 pct yr/yr, vs forecast 3.3 pct
* October factory output up 10.3 pct vs forecast 10 pct
* Jan-Oct fixed-asset investment rises 20.1 pct
* Data comes as top leaders discuss reform plans
By Xiaoyi Shao and Kevin Yao
BEIJING, Nov 9 China's annual inflation climbed
to an eight-month high of 3.2 percent in October as food costs
soared, fanning market worries about policy tightening as
factory output and investment data pointed to signs of
stabilisation in the economy.
Inflation, which quickened slightly from 3.1 percent in
September, was still lower than a median forecast of 3.3 percent
in a Reuters poll and was below the official target of 3.5
percent for 2013.
"Although the CPI inflation was mainly pushed up by seasonal
food demand, it may fuel market concerns that the central bank
may tighten monetary conditions," said Li Huiyong, an economist
at Shenyin & Wanguo Securities in Shanghai.
The People's Bank of China refused to inject liquidity into
the money markets during regular open market operations on
Thursday, triggering worries it would start a new round of
tightening in the next few months, traders said.
Data on Friday showed exports rebounded by more than
expected in October, adding to signs the economy has found its
footing as Beijing prepares its reform agenda for the next
But few analysts believe the central bank will rush to
tighten policy amid the lingering global uncertainties.
The PBOC has said it will maintain its prudent
policy-setting with timely fine-tuning to keep the economy on an
even keel while warding off inflationary risks.
The National Bureau of Statistics said food prices rose 6.5
percent in October from a year earlier, quickening from 6.1
percent in September.
China's producer prices fell 1.5 percent last month from a
year earlier - the 20th consecutive month of decline - versus a
fall of 1.3 percent the previous month, the bureau said.
Economists polled by Reuters had expected consumer inflation
of 3.3 percent and factory-gate prices to decline 1.4 percent.
Month-on-month, consumer prices were up 0.1 percent versus a
rise of 0.2 percent expected by economists. Producer prices in
October were unchanged from the previous month.
NO TIGHTENING SEEN
Data from the National Bureau of Statistics also showed
China's factory output rose 10.3 percent in October from a year
earlier, beating market expectations of 10 percent.
Fixed-asset investment, a key driver of economic growth,
climbed 20.1 percent in the first 10 months from a year earlier
- in line with forecasts. Real estate investment growth rose
19.2 percent, while revenue from property sales rose 32.3
Retail sales, a key gauge of consumption, were up 13.3
percent in October from a year earlier, versus 13.4 percent
expected by the market.
"Overall, the data showed that economy is stabilising but
there are still many external uncertainties," said Chen Letian,
an economist at Rising Securities in Beijing.
"We don't expect the central bank to tighten policy sharply,
although it may fine-tune policy by targeting market liquidity."
A Reuters poll showed annual growth could slow to 7.5
percent in the fourth-quarter of 2013 from 7.8 percent in the
previous three months. The full-year growth could be 7.6 percent
- the weakest in 14 years - but ahead of the government's target
of 7.5 percent.
Chinese leaders began a four-day secret meeting on Saturday
to set a reform agenda for the next decade as they try to push
more sustainable growth after three decades of breakneck
They have pledged to steer the economy away from its
dependence on investment and exports to one driven more by
consumption, services and innovation, which they consider more