China’s consumer and wholesale inflation picked up in August, lifted by elevated global commodity prices and robust demand from high-tech industries, even as underlying household consumption stayed tepid, official data showed Wednesday.
The producer price index rose 3.8% from a year earlier, according to the National Bureau of Statistics, beating economists’ expectations for a 3.6% gain and accelerating from July’s 3.5% increase, which had been the weakest reading in three months.
Economists largely attributed the pickup to favorable base effects and higher commodity costs rather than a genuine revival in domestic demand. Consumer spending has remained soft as the impact of Beijing’s trade-in subsidies and other consumption-boosting measures fades. The Iran war has pushed oil prices sharply higher in recent months, adding to input costs for manufacturers.
Consumer prices firm slightly
The consumer price index rose 0.8% year on year in August, matching economists’ estimates in a Reuters poll and accelerating from July’s 0.5% gain. Core CPI, which excludes volatile food and energy prices, climbed 1.0%, edging up from a 0.9% rise in July.
NBS chief statistician Dong Lijuan said the rebound reflected volatile global commodity prices, seasonal food price increases, and rising demand in high-tech industries, according to a statement accompanying the release.
Economists cautious on growth
Danske Bank this week lowered its 2026 GDP growth forecast for China to 4.6% from 4.8%, citing disappointing consumer data in recent months. The bank also trimmed its consumer inflation forecast for the year to 0.8% from a previous 1%.
“China’s domestic economy remains stuck in a slump, with a negative feedback loop of falling home prices, high savings, weak employment, and slow consumer spending,” said Allan von Mehren, chief China economist at Danske Bank. “Until we see a moderate recovery in the housing market, we expect household confidence to remain low and private consumption growth weak.”
Growth in the world’s second-largest economy has lost momentum after a solid start to the year. Second-quarter expansion was the slowest in more than three years, and July data showed both retail sales and urban investment weakening, adding pressure on Beijing to increase support in the months ahead.
Separately, the urban youth unemployment rate climbed to 17.9% in July, the worst reading since August 2025, according to official figures.
Source: www.cnbc.com — https://www.cnbc.com/2026/09/09/china-cpi-ppi-august-oil-prices-tech-manufacturing-.html
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