China's consumer prices return to growth, producer prices decline narrows

China's consumer prices returned to growth after falling for two consecutive months, while the decline in factory-gate prices continued to narrow in October, official data showed on Sunday.

China's consumer price index, the main gauge of inflation, rose by 0.2 percent year-on-year in October, following a 0.3 percent drop in September, according to the National Bureau of Statistics (NBS).

Month-on-month, the CPI increased 0.2 percent in October versus a 0.1 percent rise in September.

"The continued implementation of policies to expand domestic demand, together with the spending boost from the National Day and Mid-Autumn Festival holidays, has helped drive a mild rebound in consumer prices in October," said Dong Lijuan, an NBS statistician.

Notably, NBS data showed the core CPI, which excludes volatile food and energy prices and is deemed a better gauge of the supply-demand relationship, rose by 1.2 percent year-on-year in October after a 1 percent rise in September — marking the sixth consecutive month of expansion and the highest rise since February 2024.

China's producer price index – which measures factory-gate prices – fell 2.1 percent year-on-year in October, easing from a 2.3 percent drop in September.

"The year-on-year decline in producer prices narrowed for the third consecutive month in October, as the continued progress in capacity management in key industries led to a narrowed year-on-year price drop in related sectors," Dong said.

"As the country accelerates the development of a modern industrial system and steadily releases its consumption potential, prices in some related sectors have begun to pick up."

On a month-on-month basis, the PPI increased by 0.1 percent in October, while the figure remained flat in September, according to the NBS.