Beijing, Feb 15 (NA) -- China's basic consumer inflation remained stable in January, according to official data, pointing to a gradual recovery in domestic demand even as general price growth moderated due to base effects from last year's Chinese New Year and lower energy costs. The Consumer Price Index (CPI), a key inflation gauge, rose 0.2% year-on-year in January, while the core CPI, which excludes food and energy prices, rose 0.8%, according to data released by the National Bureau of Statistics (NBS). The growth of the overall CPI slowed from the 0.8% increase in the previous month, largely due to base effects linked to the timing of the Chinese New Year and a sharper drop in energy prices, explained NBS statistician Dong Lijuan. Last year's Spring Festival fell in January, which pushed up food prices and some services and left a higher comparison base, according to a Xinhua report, to which the Argentine News Agency is subscribed. Declining sectors As a result, food prices fell 0.7% year-on-year in January 2026, which subtracted about 0.11 percentage points from the CPI, noted Dong. Energy prices fell 5.0%, which subtracted about 0.34 percentage points from the CPI, according to the data. Despite the more moderate overall reading, underlying inflation showed signs of improvement. On a monthly basis, the core CPI increased 0.3%, the fastest pace in nearly six months, indicating a moderate and continuous recovery in consumer demand. Price increases for industrial consumer goods, excluding energy, continued to widen. "The data shows that consumer demand has continued to recover and that the trend of moderate growth in the core CPI remains unchanged," said Dong. Wednesday's data also revealed that China's Producer Price Index (PPI) rose 0.4% month-on-month in January, marking the fourth consecutive monthly increase, while the annual decline narrowed to 1.4% from a 1.9% drop in December. The NBS attributed this improvement to steady progress in building a unified domestic market, rising demand in some sectors, and price transmission from international commodity markets. The data comes as the Chinese government steps up efforts to boost domestic demand. Last month, China unveiled a comprehensive policy package leveraging fiscal and financial synergy to stimulate consumption and revitalize private investment. The country's top economic planner also pledged to formulate a strategic implementation plan to expand domestic demand for the 2026-2030 period. The National Development and Reform Commission stated that the plan aims to adapt to improvements in consumption and technological changes, fostering a 'virtuous circle' where 'new demand drives new supply and new supply creates new demand' through strong support for innovation. Prices for these goods rose 2.6% year-on-year, with an increase rate 0.1 percentage points faster than the previous month.
