China’s consumer prices rose at their fastest annual pace in over two and a half years in December 2025, signaling a gradual recovery in domestic demand amid stabilizing economic policies. Official data released on January 9, 2026, showed the Consumer Price Index (CPI) increased 0.8% year-on-year last month, up 0.1 percentage points from November and marking the highest growth since March 2023.
Month-on-month, CPI edged up 0.2%, driven primarily by a 1.1% annual rise in food prices, according to Dong Lijuan, chief statistician at the National Bureau of Statistics (NBS). Analysts attribute the uptick to improved supply chain efficiency and targeted measures to stimulate consumption.
Wen Bin, chief economist at China Minsheng Bank, projects a sustained recovery in consumer prices this year as policies to bolster domestic demand and modernize industrial systems gain traction. "The narrowing decline in producer prices reflects improving market confidence," he noted, referencing the 1.9% year-on-year drop in the Producer Price Index (PPI) for December—a milder contraction compared to earlier months.
Domestic macro policies have begun yielding results, with NBS data highlighting reduced price declines in key sectors. The development of a unified national market and optimized industrial competition frameworks are expected to further stabilize economic conditions in 2026.
