China’s annual inflation rate rose to 1.3% in February 2026 from 0.2% in January, the highest level since January 2023 and above market expectations of 0.8%. The increase was driven largely by the timing of the Lunar New Year, which fell in mid-February and typically boosts holiday-related spending.
Food prices posted their strongest gain since October 2024, rebounding from a prior decline (up 1.7% vs down 0.7% in January). Non-food inflation also picked up markedly (1.3% vs 0.4%), with upward pressure coming from clothing (1.9%, unchanged from 1.9%), healthcare (1.9% vs 1.7%), and education (2.0% vs flat previously). Meanwhile, transport costs fell at a much slower pace (-0.7% vs -3.4%), while housing prices continued to edge lower (-0.2% vs -0.1%).
On a monthly basis, the CPI rose 1.0%, accelerating from 0.2% in January and marking the largest month-on-month increase since January 2021.
