Data released on April 13 by the Sichuan Investigation Team of the National Bureau of Statistics shows that in March, the Consumer Price Index (CPI) in Sichuan Province increased by 1.1% year-on-year, a rate 0.1 percentage points higher than the previous month. However, on a month-on-month basis, the CPI decreased by 0.5%, shifting from an increase in the previous month to a decline. Meanwhile, the Producer Price Index (PPI) for industrial producers in Sichuan increased by 1.0% month-on-month and remained flat year-on-year, ending a 41-month consecutive streak of year-on-year declines and signaling a potential bottoming out and recovery.
The slight month-on-month decline in the CPI is attributed to a seasonal drop in consumer demand following the Spring Festival holiday. As the impact of the holiday faded, travel and tourism entered a low season, leading to weaker consumer demand in related sectors. This affected prices for vehicle rentals, which fell by 20.4% month-on-month, airfares, which dropped by 19.8%, and travel agency fees, which decreased by 13.7%. Furthermore, the spring season brought an abundant supply of fresh vegetables and fruits to the market, causing prices for fresh vegetables to fall by 8.0% and fresh fruit prices to drop by 4.0% compared to the previous month. Additionally, March saw weaker demand for pork alongside sustained high supply levels, resulting in a 9.8% month-on-month decline in pork prices.
In contrast, prices for industrial consumer goods showed significant increases, influenced by international factors, supply-demand dynamics, and rising costs. Conflicts in the Middle East contributed to higher international crude oil prices, leading to increased domestic fuel prices. In Sichuan, gasoline prices rose by 10.9% month-on-month. Moreover, heightened demand driven by interest in artificial intelligence, coupled with tight supply for components like computer memory and hard drives, pushed prices for storage devices up by 7.3% and computer prices up by 1.4% in March, marking the fourth consecutive month of increases for computers.
Notably, Sichuan's core CPI, which excludes food and energy prices, increased by 1.3% year-on-year. Although this growth rate was 0.3 percentage points lower than the previous month, it represents the 13th consecutive month of increase, indicating a clearer signal of price recovery. Experts note that the core CPI, by excluding volatile categories like pork, vegetables, and oil, better reflects long-term price trends and endogenous changes. Its sustained strength suggests enhanced internal economic growth momentum and gradual improvements in supply-demand balances.
The stabilization of the PPI on a year-on-year basis, shifting from decline to flat, alongside a 1.0% month-on-month increase—0.9 percentage points higher than the previous month—releases positive signals. The primary drivers for this PPI recovery are rising prices for products such as electricity, crude oil, non-ferrous metals, and batteries, combined with the full resumption of industrial operations after the Spring Festival, which led to a gradual warming of market demand.
Among major industries, power generation saw the most significant price rebound, with a 7.5% month-on-month increase in March. Year-on-year, the sector shifted from a 3.6% decline in February to a 3.5% increase. Following market-oriented reforms, electricity prices now more accurately reflect real-time supply and demand conditions. Post-holiday, industrial electricity consumption rose substantially, leading to higher prices during peak hours and periods of tight supply, with more pronounced price fluctuations for customers purchasing electricity through agents.
Prices for electronic components and specialized electronic materials manufacturing also rose sharply, increasing by 9.6% month-on-month in March—6.3 percentage points higher than the previous month—and by 32.5% year-on-year. This surge is mainly due to significant price increases for upstream raw materials like silver paste and lithium carbonate. Since January, rising demand from downstream sectors such as power batteries and energy storage cells has pushed the spot price of battery-grade lithium carbonate from approximately 120,000 yuan per ton at the start of the year to around 150,000 yuan per ton currently.
Rising international crude oil prices have also driven up costs in related industries. In March, refined petroleum product manufacturing prices increased by 6.5% month-on-month. Midstream chemical sectors, including basic chemical原料 manufacturing, synthetic materials manufacturing, and specialty chemical products manufacturing, faced rising cost pressures due to higher crude oil prices. For instance, inorganic acid manufacturing prices surged by 41.0% year-on-year. Downstream supporting industries, such as rubber and plastic products and paint, ink, and pigment manufacturing, were indirectly affected by rising prices of oil derivatives. Industrial pigment manufacturing prices rose by 9.6% month-on-month and 9.2% year-on-year in March. Increasing international non-ferrous metal prices directly benefited upstream smelting industries, with non-ferrous metal smelting and rolling processing overall seeing a significant 21.5% year-on-year increase in March.
Analysts suggest that the halt in the PPI's year-on-year decline and its stabilization are primarily influenced by volatility in international energy markets and improvements in supply-demand dynamics in certain sectors. Since the beginning of the year, multiple government departments have coordinated efforts, introducing a series of measures aimed at expanding domestic demand, optimizing supply, strengthening market regulation, and ensuring social welfare. These actions are steadily guiding prices back to reasonable levels, and the price situation is expected to continue improving in the next phase.
Comments