Chinese inflation hit a 10-month high in February while growth in industrial production and retail sales slowed, official data shows, complicating policymakers’ efforts to boost recovery.

Growth in the world’s second-largest economy slowed to a 13-year low of 7.8 per cent in 2012, though a pick-up in the final three months had raised hopes for a rebound this year.

The consumer price index - a main gauge of inflation - rose 3.2 per cent year-on-year in February, according to the National Bureau of Statistics (NBS), as holiday season spending and rapid credit growth accelerated price rises.

The figure was a spike from January’s 2.0 per cent and the highest result since April 2012, when it stood at 3.4 per cent. It was also above economists' expectations for a 3.0 per cent rise.

Inflation is a key issue for the ruling Communist Party as it brings with it the risk of popular discontent over rising prices and the threat of social unrest.

Other indicators announced on Saturday by the NBS provided further signs that a budding recovery may be fragile.

‘‘The Chinese government is caught in the dilemma of dealing with slower growth and yet higher inflation again,’’ Ren Xianfang, a Beijing-based analyst with research firm IHS Global Insight, said in a research note.

Industrial output, which reflects production at China’s factories, workshops and mines, rose 9.9 per cent year-on-year over the first two months of 2013, compared with 11.4 per cent in the same period of 2012.

Retail sales - the main gauge of consumer spending - were up 12.3 per cent over the period, slowing from 14.7 per cent in the January-February period of last year.

Giving the figures for the two-month period minimised distorted comparisons due to the Lunar New Year, which fell last month this year but in January for 2012.

Fixed-asset investment - a key measure of official spending on infrastructure - rose 21.2 per cent in January-February, higher than the 20.6 per cent for the full year of 2012 and underscoring what analysts say is an old-fashioned recovery led by fast investment growth.

"This data shows that the economy is in the process of a mild recovery and that it is still fragile," Xu Gao, chief macro-economic analyst at Everbright Securities in Beijing, said. "It faces a lot of uncertainties."

The risk is that the economy needs monetary policy tightened to cool prices before industrial activity and retail sales regain momentum lost last year as the Chinese economy delivered its slowest full year of growth since 1999, at 7.8 per cent.

Outgoing Chinese Premier Wen Jiabao on Tuesday announced an economic growth target of 7.5 per cent for 2013 - the same as last year’s - and reiterated the government’s vow to retool the economy away from investment-led growth.

Wen also said that the 2013 inflation target was set at 3.5 per cent, lower than last year’s goal of 4.0 per cent, but higher than the actual inflation rate for 2012, which came in at 2.6 per cent.

AFP, Reuters