China’s consumer price index (CPI), a key gauge of inflation, fell by 0.8% year-on-year in January, marking the fourth consecutive month of decline, according to data released by the National Bureau of Statistics (NBS) on Thursday. On a month-on-month basis, however, the CPI increased by 0.3% during the same period.
The NBS attributed the year-on-year decline in CPI primarily to a high base effect from the previous year. In contrast, the month-on-month rise was driven by increased consumer demand ahead of the Spring Festival holiday, as families prepared for the festivities.
Meanwhile, China’s producer price index (PPI), which measures costs for goods at the factory gate, dropped by 2.5% year-on-year in January, easing from a 2.7% decline in December. The PPI decline was influenced by multiple factors, including fluctuations in international commodity prices, the NBS noted. On a monthly basis, the PPI dipped by 0.2% in January following a 0.3% decrease in December.
Economists view these inflation indicators as signs of shifting dynamics in the world’s second-largest economy. Bruce Pang, chief economist at JLL Greater China, expects a mid-term shift towards more normalized inflation rates and anticipates continued improvement in China’s economic performance over the long term.
“From a full-year perspective, China’s CPI will rebound moderately, while the PPI is expected to turn from negative to positive,” Pang commented.
Reference(s):
cgtn.com
