The mild decline last month in China's consumer price index (CPI), a main gauge of inflation, was driven by seasonal factors such as the Spring Festival holiday, said a spokesman of the National Bureau of Statistics (NBS) on Monday.
At a press conference in Beijing, Fu Linghui, the spokesman, said the CPI for the first two months of this year, including the movable Chinese New Year holiday, dropped 0.1 percent compared with the same period last year
"Historically, the Spring Festival has had a significant impact on the CPI from January to February, especially when the timing of the festival differs between this year and the previous year, which can cause more notable fluctuations in the CPI during these two months. This is primarily due to the concentrated surge in demand for goods and services before and during the Spring Festival, which leads to a rise in prices during this period. After the festival, as demand subsides, prices typically decrease," said Fu.
He further said that before the Spring Festival holiday, people often experience a rise in the prices of food and transportation. However, as demand decreases after the holiday, prices naturally fall back.
"Judging from this year's situation, in January, the CPI rose by 0.5 percent year on year, largely due to the influence of the Spring Festival, which was a significant increase compared to the previous month. In February, due to the variable timing of the Spring Festival, the CPI decreased by 0.7 percent year on year. This year's Spring Festival fell in January, while last year it was in February. If the effect of the variable timing of the Spring Festival is excluded, the CPI in February actually rose by 0.1 percent year on year," Fu said.
He noted that in February, the price of fresh vegetables declined year on year, while promotional discounts on automobiles also contributed to a lower CPI increase. In the same period of Last year, freezing rain and snow in some regions led to a sharp rise in fresh vegetable prices.
Due to this high base effect, fresh vegetable prices fell by 12.6 percent in February, impacting the CPI by approximately 0.31 percentage points. Additionally, fuel car and new energy vehicle prices dropped by 5.0 percent and 6.0 percent, respectively, affecting the CPI by about 0.16 percentage points year on year. Overall, the moderate upward trend of the CPI remains unchanged, Fu said.
"From the perspective of the CPI structure, driven by improved market demand, the prices of certain goods and services rose steadily in February. The price of industrial consumer goods, excluding energy, increased by 0.2 percent year on year. Among them, the prices of recreational and durable consumer goods, clothing, communication tools, and small household appliances rose between 1.0 percent and 1.6 percent. Prices in some service industries also saw steady growth. In February, the cost of domestic services rose by 2.6 percent year on year, while dining-out expenses increased by 1.2 percent, both reflecting the impact of stronger market demand on prices," the spokesman said.
Seasonal factors behind decline in February's inflation data: official
