Watch VideoPlay Video
China's consumer price index reached a new high last month. It's standing at 3.3 percent is in line with market expectations.
China's CPI growth for July, the main gauge of inflation, surpassed the 3 percent alert level for the second time this year, after the 3.1 percent increase in May. But this time, it's reached a peak.
The National Bureau of Statistics says food prices are behind the increase. Economists agree.
Wang Yuanhong, Senior Economist of State Information Center said "Food prices account for about one-third of the CPI. Increasing food prices due to extreme weather have definitely driven up the index growth rate."
In the meantime, economists say the low comparison basis as well as lingering uncertainties abroad have also had some impact on domestic prices.
Zhuang Jian, Senior Economist of Asian Development Bank said "The declining commodity prices have started to rebound, including steel and non-ferrous metal. This is partly because of the U.S. decision to maintain loose monetary policies. I think the rebound is probably another reason for price rises at home."
Data also shows the producer price index, which shows factory-gate inflation, rose 4.8 percent in July. That's compared to 6.4 percent growth last month.
Officials say the government is able to control the whole year inflation rate under the 3 percent target.
Analysts also believe food prices are unlikely to continue their upward trend in the coming months.