BEIJING—China’s consumer prices slipped into deflationary territory last month in year-over-year terms, while the country’s factory-gate prices began to reflate after 11 straight months of decline.
China’s producer-price index returned to inflation at the start of the year by rising 0.3% in January from a year earlier, compared with a 0.4% fall year-over-year in December.
Chinese producer prices began falling a year ago as the coronavirus pandemic ravaged first the domestic economy and then other parts of the world. Demand and production in the industrial sector were both weighed down, hitting commodity prices.
Now, driven by improved domestic demand and rising prices for crude oil, iron ore and other raw materials, Chinese producer prices rose 1.0% in January compared with a month earlier, China’s National Bureau of Statistics said Wednesday.
With industrial production and demand continuing to improve, China’s producer-price index will likely remain in positive territory for the rest of the year, said Zhang Ning, an economist at UBS.
