China Watch: CPI inflation steady in May while PPI inflation strength persists

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China Watch: CPI inflation steady in May while PPI inflation strength persists

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China Watch

CPI inflation steady in May while PPI

inflation strength persists

Exhibit 1: May CPI and PPI came in at 1.2% yoy and 3.9% yoy respectively 10 June 2026

May CPI and PPI inflation yoy, vs. consensus and BofA forecasts (announced: 10 June 2026) GEM Economics

CPI PPI Asia | China

% yoy % yoy

Actual 1.2 3.9

Previous 1.2 2.8

Consensus 1.3 3.9

Yvonne He BofA Global Research 1.5 3.5 China & Asia Economist

Source: BofA Global Research estimates, Bloomberg, NBS Merrill Lynch (Hong Kong)

BofA GLOBAL RESEARCH +852 3508 5396

yvonne.he@bofa.com

May Headline CPI inflation remained steady Xiaoqing Pi

May headline CPI inflation came in at 1.2% yoy for another month, broadly in line with GreaterMerrill LynchChina(HongEconomistKong)

expectations. On a sequential basis, CPI contracted by 0.1% mom. Excluding food and +852 3508 6584

xiaoqing.pi@bofa.com

energy, core inflation was 1.1% yoy (vs. 1.2% in April). Food prices declined by 1.7% yoy,

while non-food inflation remained elevated at 1.9%. Decline in pork prices (-16.1%) HelenChina &QiaoAsia Economist

dragged CPI down by 0.3ppt. PPI inflation was consistent with expectations, rising 3.9% Merrill Lynch (Hong Kong)

+852 3508 3961

yoy, up from 2.8% in April. Sequentially, PPI rose 0.5% mom. helen.qiao@bofa.com

Goods CPI inflation edged up; services inflation softened

CPI inflation of goods picked up (1.6% yoy) while that for services moderated (0.8%).

Fuel was the main driver of the goods price inflation (gasoline +23.5% yoy), while gold

Abbreviations:jewelry price increases moderated (+39% yoy, 0.17ppt contribution) and modest gains in

household appliances and apparel provided a smaller additional boost.