The year-on-year increase in China's Consumer Price Index (CPI) slowed in January, influenced by factors including the timing shift of the Lunar New Year holiday. Meanwhile, the Producer Price Index (PPI) continued to improve, supported by the ongoing implementation of anti-overcapacity policies and rising demand in certain sectors. Data released on February 11 by the National Bureau of Statistics showed that CPI rose 0.2% month-on-month and 0.2% year-on-year in January, while PPI increased 0.4% month-on-month but fell 1.4% year-on-year.
The year-on-year CPI growth in January was 0.2%, down 0.6 percentage points from December. A chief statistician from the Department of Urban Surveys indicated that the slowdown in CPI growth was mainly due to two factors: the shift in the Lunar New Year holiday timing and a decline in energy prices caused by changes in international oil prices. January of the previous year coincided with the Lunar New Year, leading to higher prices for food and certain services, which created a higher base effect and contributed to the larger slowdown in the year-on-year increase this January.
Additionally, energy prices fell 5.0% year-on-year in January, dragging down the CPI by approximately 0.34 percentage points—0.06 percentage points more than the previous month. Gasoline prices dropped 11.4% year-on-year, with the decline widening by 3.0 percentage points from December. Core CPI, which excludes food and energy prices, rose 0.8% year-on-year and increased 0.3% month-on-month, marking the highest monthly growth in six months. The chief statistician noted that consumer demand continues to recover, and the trend of moderate core CPI growth remains unchanged. Prices of industrial consumer goods, excluding energy, also saw a sustained expansion in year-on-year growth.
Notably, prices of essential daily necessities remained stable with ample supply ahead of the holiday. Food prices were flat month-on-month: fresh vegetable prices fell 4.8%, while grain and cooking oil prices dropped 0.1% and 0.2%, respectively. Pork and poultry prices rose 1.2% and 0.2%, respectively, while aquatic products and fresh fruit prices both increased 2.0%.
On the PPI front, the index rose 0.4% month-on-month in January, marking the fourth consecutive monthly increase and accelerating by 0.2 percentage points from December. The chief statistician highlighted key features of the month-on-month PPI performance: first, continued progress in building a unified national market contributed to price increases in certain industries; second, rising demand pushed up prices in related sectors; and third, imported factors led to divergent price trends in domestic nonferrous metals and petroleum-related industries.
Since last year, efforts to curb overcapacity in sectors such as photovoltaics, power batteries, cement, and steel have deepened, leading to positive price improvements in these areas. Data showed that in January, cement manufacturing and lithium-ion battery manufacturing prices both rose 0.1% month-on-month, extending their increases to four consecutive months. Prices for photovoltaic equipment and components shifted from a 0.2% decline in December to a 1.9% increase in January. Basic chemical raw materials manufacturing prices turned from a 0.1% drop to a 0.7% rise, while ferrous metal smelting and rolling processing prices increased 0.2%, reversing a 0.1% decline.
Rapid development in digital technologies such as artificial intelligence, along with growing demand for computing power, drove a 0.5% month-on-month increase in prices for computer, communication, and other electronic equipment manufacturing. Within this category, electronic semiconductor materials and external storage devices and components rose 5.9% and 4.0%, respectively. Increased pre-holiday demand for gifts and food contributed to price increases of 4.1% and 0.3% in arts, crafts, and ceremonial products manufacturing, as well as agricultural and sideline food processing. Higher demand for winter warmth and cold protection pushed up prices for cold-weather clothing and down processing by 0.9% and 0.8%, respectively.
Moreover, rising international nonferrous metal prices drove domestic nonferrous metal mining and processing prices up 5.7% month-on-month, while nonferrous metal smelting and rolling processing prices rose 5.2%. Silver smelting, copper smelting, gold smelting, and aluminum smelting prices increased by 38.2%, 8.4%, 4.8%, and 2.3%, respectively.
Looking ahead, a spokesperson for the National Bureau of Statistics recently stated at a press conference that favorable conditions for a moderate rebound in prices are accumulating. From a fundamental perspective, as measures to boost consumption are effectively implemented—particularly incremental policies promoting domestic demand through fiscal and financial coordination—consumer demand is expected to gradually expand, providing a foundation for stable price levels. In terms of policy support, the effects of industry self-regulation and capacity management will continue to be felt. This year, capacity control in key industries will be strengthened, and product standards and quality improved, which will support price recovery.
The spokesperson emphasized that, overall, promoting a reasonable rebound in prices will benefit both corporate and household income growth, as well as stabilize market expectations. Continued efforts to leverage the integrated effects of macroeconomic policies, expand household consumption, regulate market competition, and actively address supply-demand imbalances will help foster a reasonable recovery in price levels.
Comments