Chinese inflation falls to 20-month low

Chinese inflation has fallen to a 20-month low, giving further room for policymakers to stimulate the economy.

The inflation rate fell from 4.5% in January to 3.2% in February, the lowest it has been since July 2010, according to the National Bureau of Statistics, after months of rampant inflation. It reached a high of 6.5% in July last year. Weak demand for exports from Europe is a major factor in the slowing of inflation while the central bank had been raising rates up until late last year to cool the economy. Analysts also said Chinese New Year may have had an effect as the Chinese tend to spend more before the holiday and then cut back after, according to the BBC. Premier Wen Jiabao set...