China’s consumer inflation remained in negative territory in September, highlighting continued weakness in domestic demand even as underlying price pressures showed tentative signs of improvement. Headline CPI rose from –0.4% yoy to –0.3% yoy, missing expectations of –0.2% yoy.
The National Bureau of Statistics said lower food and energy prices were the main contributors to the decline, with food prices down -4.4% yoy and consumer goods prices falling -0.8% yoy, partly offset by a 0.6% yoy increase in service prices.
However, the data also showed hints of stabilization beneath the surface. Core CPI, which excludes food and energy, rose 1.0% yoy from a year earlier, its highest level since February 2024, suggesting that domestic price momentum is slowly recovering in service sectors and other non-food categories.
Meanwhile, factory-gate prices continued to contract, with PPI rising from –2.9% yoy to –2.3% yoy, in line with expectations. This marks the 36th consecutive month of producer deflation, underscoring persistent cost pressures in manufacturing. NBS statistician Dong Lijuan said recent capacity management efforts in several industries have helped narrow the pace of decline, noting that market competition has improved as industrial supply and demand slowly rebalance.
