The National Bureau of Statistics (NBS) said China's consumer price index (CPI), the main gauge of the country's inflation, rose to 2.3 percent in July, the same growth pace registered in June.

The figure is still way below the government's target of around 3.5 percent this year but the Shanghai-based E-House China R&D Institute said the July inflation rate was "in a very comfortable range".

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According to Yang Hongxu, the deputy head of the institution, when inflation rate goes too high, residents will feel the pain and if it goes too low, Chinese companies will suffer.

"The July inflation rate was in a very comfortable range," he said.

The 2.3 percent July inflation rate was similar to the figure registered in the first six months of the year, showing that the country's prices have stabled, the NBS said.

Inflation in urban areas grew 2.4 percent while in rural areas the growth was 2.1 percent, the NBS data release on Saturday showed.

Food prices in July grew 3.6 percent, or a hairline down from 3.7 percent registered in June. Food prices account for about a third of the weighting in the calculation of China's CPI.

Residential prices, meanwhile, grew by 2 percent in July, year on year, despite the cooling property sector, the NBS data showed.

Also on Saturday (China time), the NBS announced that the country's producer price index (PPI) dropped 0.9 percent in July, year on year.

The CPI measures the country's inflation at a wholesale level.

China's PPI dropped for 29 months in a row in July, but the pace of decline narrowed for four consecutive months, down from 1.1 percent in June, 1.4 percent in May, 2 percent in April and 2.3 percent in March.

TagsChina Inflation