(Yicai Global) March 9 -- Growth of the consumer price index in China declined in February compared with the previous month as a result of changes set off by the Chinese New Year holiday, the latest National Bureau of Statistics data shows.
The CPI rose 0.8 percent year-on-year, but fell 0.2 percent month-on-month, the NBS said today. The producer price index rose 7.8 percent year-on-year and 0.6 percent month-on-month. The average national CPI in the first two months this year increased 1.7 percent compared with the same period last year.
In February, China's PPI grew 0.6 percent month-on-month and 7.8 percent year-on-year. The average PPI in the first two months of this year jumped 7.3 percent compared with the same period last year.
Despite the month-on-month slowdown in CPI growth in February, the core CPI excluding food and energy prices remained stable. It was up 1.8 percent and 2.2 percent in February and January, respectively, indicating a consistent trend of modest gains since last year.
Dramatic decreases in food prices and tourist services prices deflated by a tourism lull after the Chinese New Year holidays contributed to the month-on-month 0.2 percent CPI drop, said Sheng Guoqing, senior statistician at the NBS urban statistics department.
The CPI's 0.8 year-on-year growth in February was 1.7 percentage points lower than the CPI growth of 2.5 percent year-on-year recorded a month earlier. The carryover effect that came out of February's high base price, which was driven up by the New Year festival and cold weather, played a major role in this slowdown, Sheng said.
Changes in food prices were the main cause. Specifically, pork prices fell 0.9 percent year-on-year and 26 percent month-on-month, compared with 7.1 percent and 1.6 percent increases in January. This moves pushed CPI growth down by 1.21 percentage points.
The Chinese New Year holidays was a primary driving force behind the 2.5 percent CPI growth in January.
The Chinese Lunar New Year takes place on a different date in the Gregorian calendar every year. It came in February in 2016 and in late January this year. The holiday has a big impact on economic activity in January and February.
The full-year increase in consumer prices should be kept at around three percent, a government work report said.