FX.co ★ China Producer Inflation Highest in Over 4 Years

China’s producer price index (PPI) rose 5.7% year-on-year in October 2026, up from 5.0% in September and above market expectations of 5.3%. This was the fastest pace of increase since June 2022, underscoring firmer commodity prices and a pickup in industrial demand following the Golden Week holiday.

Prices of production materials continued to accelerate, climbing 7.4% compared with 6.5% in September. This was led by stronger gains in mining (27.9% vs 25.4%), raw materials (11.6% vs 9.4%), and processing (3.5% vs 3.4%).

By contrast, prices of consumer goods remained weak, edging down 0.1% year-on-year, unchanged from the prior month. Declines in food (-1.6% vs -1.8%), clothing (-1.3% vs -1.2%), and daily-use goods (-0.7% vs -0.6%) more than offset the still-positive, though slower, growth in durable goods prices (1.4% vs 1.6%).

On a monthly basis, the PPI increased 0.7% in October, moderating from a 1.2% gain in September, which had been the strongest monthly rise in five months. Over the first ten months of 2026, producer prices were up 2.7% year-to-date, compared with a 2.3% increase in the same period a year earlier.