China’s Consumer Inflation Drops to Nine-Month Low in March

China’s consumer inflation rate in March fell to its lowest level since September 2021, according to official data released on Tuesday. The slowdown was primarily driven by a decrease in food prices, indicating that demand remains weak despite an uneven economic recovery.

The National Bureau of Statistics reported that the Consumer Price Index (CPI) rose 0.4% year-on-year last month – down from 1% in February and the slowest growth since September 2020 when it stood at 0.5%. Food prices were down 2%, compared with a 4% rise recorded for February, while non-food items saw their costs increase by 1%.

Analysts believe this could be due to China’s efforts to reduce poverty as well as government policies aimed at stimulating consumption during the pandemic period which have resulted in lower food prices for consumers across the country. Other factors such as low global commodity prices and reduced transportation costs may also have contributed to this decline in CPI growth rates over recent months.

Overall, these figures suggest that although there are signs of economic recovery taking place within China’s economy overall consumer demand is still relatively weak, and further policy measures may need to be taken if the sustained improvement is desired going forward into 2021/22.