China's consumer price index rose 0.8 percent in the first two months of 2026, driven by a surge in spending during an extended Chinese New Year holiday. However, analysts remain concerned about long-term deflation risks.
China's consumer prices rose during the first two months of 2026, as a longer-than-usual Chinese New Year holiday drove a surge in spending, though analysts cautioned that Beijing might need to implement stronger measures to boost demand and sustain the recovery.
The national consumer price index (CPI), a key gauge of inflation, rose 0.8 percent year on year during the January-February period, according to data released by the National Bureau of Statistics (NBS) on Monday. Readings for the first two months are typically combined to minimize distortions from the Chinese New Year holiday, which fell in February this year but took place in January last year.
In February alone, consumer prices rose 1.3 percent year on year—the largest monthly increase in about three years—which the bureau largely attributed to the differing timing of the extended break and a recovery in demand. This monthly figure also exceeded market expectations of a 0.93 percent rise, based on economists polled by financial data provider Wind, which did not issue a forecast for the January-February combined period.
While the short-term data shows positive momentum, analysts highlight persistent long-term deflation risks, suggesting the need for further government action to support the economy.
