China's inflation rate slowed last month, raising hopes that its central bank will reduce interest rates to encourage growth.
Consumer prices rose by 3.4% from a year earlier.
The rate of inflation has now been under the government's target of 4% for three months in a row.
This comes just a day after China reported that its export and import growth had slowed, leading to fears of a slowdown in its economy.
Chinese retail sales rose 14.1% in April compared with the same period a year earlier, the government said.
Retail sales are the main gauge of consumer spending in the world's second-largest economy and serves as an indicator of the government's progress in making domestic consumption account for a bigger share of growth.
Other figures published today indicate that growth in industrial output from China's millions of factories and workshops slowed to 9.3% when compared with the same period last year.
The figure, which is down from growth of 11.9% in March, followed worse-than-expected import data on Thursday that indicate a slowdown in the world's number two economy.
China's urban fixed asset investments rose 20.2% in the first four months of 2012 compared with a year earlier.
Fixed asset investments in the cities are a key gauge of the Chinese government's infrastructure spending, which has increased rapidly in recent years as Beijing has sought to cushion the impact of the global downturn.
