China Inflation Rate at 5-Month High


China's annual inflation rate came in at 1.8 percent in January of 2016, up from 1.6 percent in the previous month and reaching the highest since August last year but below market expectations. The politically sensitive food prices increased 4.1 percent while non-food cost rose at a slower 1.2 percent. Cost of consumer goods gained 1.5 percent and those of services advanced 2.2 percent. On a monthly basis, consumer prices rose 0.5 percent, the same pace as in the previous month and in line with expectations.

Among food, upward prices pressure came from: fresh vegetables (+14.7 percent in January from +11.8 percent in December), meat and poultry (+10.8 percent from +6.2 percent) and tobacco (+6.5 percent from +3.9 percent). Prices of pork also rose by 18.8 percent, following a 14.0 percent increase in the previous month. In contrast, downward pressure came from cost of: egg (-3.9 percent from -11.1 percent), fresh fruits (-6.8 percent from -6.9 percent). Prices of liquid milk and dairy products remained unchanged.

For non-food categories, upward prices pressure came from: clothing (+1.9 percent from +2.0 percent) and housing (+1.4 percent from +0.8 percent), household equipment supplies and services (+0.6 percent from +0.8 percent); education, culture and entertainment (+1.7 percent from +1.3 percent) and healthcare (+2.9 percent from +2.5 percent). In contrast, downward prices pressures came from transport and communications (-1.6 percent from -1.3 percent) and other supplies and services (-0.4 percent).

On a monthly basis, consumer prices rose 0.5 percent, the same pace as in the previous month and in line with expectations.

The producer price index fell by 5.3 percent in January, slowing from a  record low of 5.9 percent drop in the previous five months. The index has been in a negative territory since March 2012.

China Inflation Rate at 5-Month High


National Bureau of Statistics | Rida Husna | rida@tradingeconomics.com
2/18/2016 11:17:30 AM