Data released by China’s National Bureau of Statistics early Monday, March 9, showed that the annual Consumer Price Index (CPI), a key measure of inflation, rose to 1.3% year-on-year in February, marking the fastest pace of growth since January 2023. This follows a 0.2% increase in January and exceeded market expectations of 0.9%. The rise in inflation was primarily driven by a 1.1% increase in service sector prices during the Chinese New Year holiday (February 15-23). ​​The index remained stable at 0.1% month-on-month in February (compared to expectations of 0.5%).

Conversely, the core index, which excludes volatile food and energy prices, rose to 1.8%, compared to a 0.8% increase in January, reaching its highest level since March 2019.

Meanwhile, China’s producer price index (PPI) remained in negative territory for the 41st consecutive month, falling to -0.9% year-on-year in February, compared to a 1.4% decline in January, while expectations had pointed to a 1.2% drop.