According to the latest economic data released by the National Bureau of Statistics, the national Consumer Price Index (CPI) rose 1.2 percent year-on-year in April 2026, exceeding the broad market expectation of 0.9 percent, with the growth rate expanding compared to the previous month. Meanwhile, the Producer Price Index (PPI) performed particularly prominently, surging 2.8 percent year-on-year to record the fastest growth pace since July 2022, far surpassing market expectations. Changes in these two key indicators reflect new price volatility challenges facing the current macroeconomy.
Within the CPI composition, energy prices emerged as the primary driver. Influenced by fluctuations in international crude oil prices, domestic energy prices increased 5.7 percent month-on-month, with gasoline prices soaring 19.3 percent year-on-year, exerting a significant upward pull on the overall price index. In contrast, food prices showed a downward trend; pork prices fell over 15 percent year-on-year, while fresh vegetable and fruit prices also retreated, partially offsetting the impact of energy price hikes. Additionally, driven by holiday effects, service prices such as airline tickets and hotel accommodations saw notable increases, while core CPI excluding food and energy maintained a moderate recovery trend.
On the production side, imported inflation pressure increased significantly. The PPI rose 1.7 percent month-on-month in April, with the year-on-year expansion widening to 2.8 percent. Specifically, prices for producer materials increased 3.8 percent, with mining industries and raw material industries seeing larger gains. Among industrial purchaser prices, costs for chemical raw materials, fuels and power, and non-ferrous metals all rose to varying degrees. Notably, chemical raw material prices jumped over 7 percent year-on-year, directly transmitting to ex-factory prices.
Analysts believe this round of price increases is primarily driven by costs rather than demand. Affected by turmoil in the Middle East and supply chain disruptions, domestic fuel and transportation costs continue to climb. Some major refining enterprises have planned to cut crude oil processing volumes to cope with supply risks. This type of cost-push inflation may have a more profound impact on the real economy; rising input costs will compress corporate profit margins, while terminal consumer demand remains weak, with prices for consumer goods still in decline year-on-year.
Although the short-term surge in energy prices has propelled a data rebound, the structural issue of insufficient domestic demand has not been fundamentally improved. Average data for January through April indicates that price levels remain relatively stable overall. Amid the complex domestic and international environment, the coexistence of rising costs and weak demand constitutes the main characteristic of recent economic operations.
