China's consumer inflation rate slowed in September, official data showed on Sunday, while producer price deflation deepened.

The consumer price index (CPI), a key measure of inflation, rose 0.4 percent year-on-year in September, down from the 0.6 percent recorded in August, the National Bureau of Statistics (NBS) said.

Meanwhile, the producer price index (PPI) fell at the fastest pace in six months, down 2.8 percent year-on-year in September, versus a 1.8 percent decline the previous month

The slowdown comes as authorities have been seeking to boost domestic activity and shore up China's property sector, with officials on Saturday announcing plans for a significant fiscal stimulus package.

Finance Minister Lan Foan told a news conference there will be more "counter-cyclical measures" this year, but officials did not provide details on the size or timing of fiscal stimulus being prepared, which investors hope will ease deflationary pressures in the world's second-largest economy

"China faces persistent deflationary pressure due to weak domestic demand. The change of fiscal policy stance as indicated by the press conference yesterday (Saturday) would help to deal with such problems," said Zhiwei Zhang, Chief Economist at Pinpoint Asset Management..

Mainland authorities have stepped up stimulus efforts in recent weeks to spur demand and help meet an around five percent economic growth target for this year,

In recent weeks, policymakers have unveiled a string of measures in a bid to stimulate activity and spur household consumption.

The central bank in late September announced the most aggressive monetary support measures since the Covid-19 pandemic, including numerous steps to help pull the property sector out of a severe, multi-year slump, including mortgage rate cuts. (Agencies)