China: Inflation eases in January from December
Latest reading: Consumer prices rose 0.2% in annual terms in January, following a 0.8% rise in the previous month. January’s reading marked the lowest print since October and missed market expectations of 0.4%. Food prices fell for the first time in three months, driven by declines in pork, eggs, and cooking oils. Non-food inflation eased despite ongoing consumer trade-in programs. Healthcare inflation edged lower, education costs were unchanged, while housing and transport recorded steeper declines.
Lastly, consumer prices rose 0.20% in January on a month-on-month basis, unchanged from the previous month’s reading.
Panelist insight: On the fall in food prices, ING’s Lynn Song said:
“This directionality was well expected, as the Lunar New Year fell in late January for 2025, while it is mid-February for 2026; households tend to ramp up food purchases for celebrations during but especially at the start of the Lunar New Year holidays, which usually coincides with a price increase for food prices. This effect will likely reverse in February’s inflation data, and overall we are still expecting food inflation to be higher in 2026 versus 2025.”