China's consumer price index (CPI), a main gauge of inflation, fell 1.2 percent year on year in March, the National Bureau of Statistics (NBS) announced on Thursday.

This was compared with a decline of 1.6 percent in February, the first monthly fall since December 2002.

The CPI declined 0.6 percent year on year in the first quarter.

Food prices, which account for around one third of the CPI, edged up 0.5 percent in the first three months.

The government set a full-year inflation target of 4 percent for 2009.

Retail sales grew 15 percent to 2.94 trillion yuan (US$430.4 billion) in the first quarter, the NBS said.

Urban sales of consumer goods rose 14.1 percent to 1.98 trillion yuan, while sales in rural areas increased 17 percent to 956.4 billion yuan.

(Xinhua News Agency April 16, 2009)