Chinese CPI rises more quickly than forecast in November

The cost of living in China rebounded in November as poor weather impacted food prices and deflationary pressures in the transport sector eased.

The country's consumer price index advanced at a 1.5% year-on-year pace last month, picking up from a reading of 1.3% in the prior month.

Economists had been expecting a smaller acceleration, to 1.4%.

Adverse weather drove vegetable price inflation to rise at a 9.4% year-on-year clip, that was far above October's gain of 4.5%.

Inflation in the non-food space also rose more quickly, rising from 0.9% to 1.1%. Transport cost deflation eased to -1.4% year-on-year after dropping 1.9% in the month before.

The regulated prices of oil were lowered last month, but by less than in the same period of one year ago.

Factory gate prices were steady at -5.9% year-on-year (consensus: -6.0%), chiefly as a result of global commodity price decreases weighing on the prices of industrial inputs.

"We aren’t overly concerned by this since with the price of domestic goods holding up better, many firms should actually benefit from these lower input costs," Capital Economics's Julian Evans-Pritchard wrote in a research note sent to clients.

"Looking ahead, we expect inflation to rise going into 2016. An acceleration in monetary growth and strong wage growth will stoke broader price pressures. In addition, with the sharp falls in the price of oil and other commodities at the end of last year now starting to drop out of the base for comparison, both CPI and PPI are set to pick-up markedly over the coming months, easing concerns over deflation."