China Prices Jump as Lunar New Year Lifts CPI

Monday 9th March 2026 – 09:09 (GMT)

China’s consumer price inflation rose to 1.3% year-on-year in February, up from 0.2% in January and marking the strongest reading since January 2023. The figure also came in above market expectations of 0.8%, with the increase largely reflecting the timing of the Lunar New Year holiday which fell in mid-February this year.

Food prices were the primary driver of the move, climbing 1.7% after a 0.7% decline the previous month. The rebound was supported by rising fresh vegetable prices and a more moderate fall in pork costs, which have weighed on the food component of the index in recent months.

Core inflation, which strips out volatile food and energy prices, rose 1.8% year-on-year – the strongest reading since March 2019. Meanwhile, non-food inflation also picked up to 1.3% from 0.4%, with steady increases in clothing, healthcare and education costs contributing to the broader firming in price pressures.

Elsewhere, transport prices continued to decline but at a slower pace than in January, while housing costs slipped slightly further into negative territory. On a monthly basis, consumer prices rose 1.0%, up from 0.2% previously and representing the largest month-on-month increase since February 2024.

For currency markets, the firmer inflation print may provide some modest support for regional risk sentiment if it is interpreted as a sign of stabilising domestic demand in China. Any improvement in the growth outlook for the world’s second-largest economy can weigh marginally on the US dollar, although investors are likely to treat the latest data cautiously given the seasonal impact of the holiday period.