Published: 10:33, June 12, 2024 | Updated: 16:11, June 12, 2024
China's consumer prices up for 4 consecutive months
By Xinhua
A consumer shops at a supermarket in Tengzhou, east China's Shandong province, April 11, 2024. (PHOTO / XINHUA)

BEIJING - China's consumer prices gained for the fourth straight month in May in the latest sign of a steady domestic demand recovery, official data showed Wednesday.

The consumer price index (CPI), a main gauge of inflation, was up 0.3 percent year-on-year last month, said the National Bureau of Statistics (NBS). The core CPI, deducting food and energy prices, went up 0.6 percent to keep the upward trajectory.

"The consumer market continued its stable performance in May," NBS statistician Dong Lijuan said.

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Non-food prices rose 0.8 percent year-on-year due in part to higher energy and service prices, while automobile prices fell amid fierce competition. Food prices declined 2 percent, narrowing from the 2.7-percent slip in April, dragged down by cheaper eggs, beef and mutton, but pork, freshwater fish and vegetables saw bigger price increases.

Data from Meituan, a leading e-commerce platform, showed daily online service deals, such as food delivery and meal coupon purchases, jumped 69 percent during the holiday from the pre-pandemic corresponding time in 2019, adding to evidence of warming consumer sentiment

On a monthly basis, the CPI inched down 0.1 percent in May, softening from the 0.1-percent increase in April. But the decrease was smaller than the 0.2-percent drop on average in the same period of the recent 10 years.

The latest data suggested the consumer market recovery continued to gain traction, analysts said.

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During the three-day Dragon Boat Festival holiday, which ended Monday, tourists spent 40.35 billion yuan (about $5.67 billion), up 8.1 percent from the same period a year ago, according to the Ministry of Culture and Tourism.

Data from Meituan, a leading e-commerce platform, showed daily online service deals, such as food delivery and meal coupon purchases, jumped 69 percent during the holiday from the pre-pandemic corresponding time in 2019, adding to evidence of warming consumer sentiment.

READ MORE: Economists expect realty bounce soon

The government has also intensified policies to boost domestic demand and bolster the economy.

China in March initiated a new round of large-scale equipment upgrades and trade-ins of consumer goods, which is expected to create consumption demand worth more than 1 trillion yuan. Thanks to more subsidies and discounts, the consumer market got a boost from robust sales of home appliances and new energy vehicles, among others.

An undated photo shows visitors posing for photos wearing zanhua, a type of floral headdress, in China, during the Labor Day holiday, in May 2024. (LENG WEN / FOR CHINA DAILY)

NBS spokesperson Liu Aihua said last month at a press conference that with the renewal program the country's price level will remain stable and rise mildly in the rest of the year.

Wu Chaoming, vice-head of Chasing International Economic Institute, predicted the CPI uptick will be seen in the fourth quarter of the year when the supportive policies deliver greater effects and domestic demand further improves.

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The NBS data showed the country's producer price index, which measures costs for goods at the factory gate, saw a significant narrowing in its year-on-year decline in May, with a drop of 1.4 percent compared to a 2.5-percent decrease in the previous month.

Rising international commodity prices and improved supply-demand conditions in the domestic market of industrial goods contributed to the decline narrowing, according to the NBS. 

A staff member works at a workshop of China First Heavy Industries (CFHI) in Qiqihar, northeast China's Heilongjiang province, April 28, 2024. (PHOTO / XINHUA)

PPI down 1.4%

China's producer price index (PPI), which measures costs for goods at the factory gate, saw a significant narrowing in its year-on-year decline in May, with a drop of 1.4 percent compared to a 2.5-percent decrease in the previous month, the NBS data showed.

Among major industries, China's coal mining and washing industry saw a 0.5-percent month-on-month price increase, driven by tight supply in major coal-producing regions and a surge in demand as power plants restock ahead of peak summer usage

The bureau attributed this to rising international commodity prices and improved supply-demand conditions in the domestic market of industrial goods.

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On a monthly basis, the PPI edged up 0.2 percent in May, reversing a decline of 0.2 percent a month earlier and ending a six-month streak of continuous decreases, the data showed.

Among major industries, China's coal mining and washing industry saw a 0.5-percent month-on-month price increase, driven by tight supply in major coal-producing regions and a surge in demand as power plants restock ahead of peak summer usage.

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Prices in ferrous metal smelting and pressing industry rose by 0.8 percent month-on-month, bolstered by favorable market expectations due to the country's large-scale equipment upgrades.

The non-ferrous metal smelting and pressing industry saw prices rise by 3.9 percent month-on-month, driven by higher international market prices.