China steers clear of deflation in 2025 as December CPI reaches its highest point in 34 months

China's Consumer Inflation Reaches Highest Point Since Early 2023

In December, China's annual consumer price inflation climbed to 0.8%, edging up from the previous month's 0.7% and marking the highest rate observed since February 2023. This outcome matched analysts' forecasts. Similar to November, the main factor behind the increase was higher food costs. Food prices accelerated to a year-on-year growth of 1.1%, the fastest pace in over a year. Notably, fresh vegetables and fruits experienced the most significant monthly gains, with prices rising by 18.2% and 4.4% year-on-year, respectively. Although pork prices continued their downward trend, the decline eased slightly, with the annual rate improving by 0.4 percentage points to -14.6%. This marks the third consecutive month of improvement in the year-on-year pork price figures.