Producer price index rose 0.3% in January from a year earlier compared with December’s 0.4% fall. Driven by improved domestic demand and rising prices of crude oil, iron ore and other commodities, China’s PPI climbed 1.0% in January from a month earlier. China’s consumer price index fell 0.3% from a year earlier in January. That compared with 0.2% growth in December. CPI headline was mainly due to a higher base of comparison last year when prices of consumer goods surged before the Lunar New Year.
Food prices rose 1.6% while non-food prices declined 0.8%. Service prices, including air tickets and tourism, had surged in January last year when people traveled for the Lunar New Year holidays and before the outbreaks of Covid-19. The government has this year encouraged residents to cancel their travel plans amid a resurgence of coronavirus cases, which has dragged down service prices. China’s consumer inflation accelerated its increase in January due to the cold weather and new coronavirus outbreaks in northern China. The CPI rose 1.0% in January from December.