Chinese inflation rates pick up as energy costs rise.

Source: Sharecast

The producer price index rose to a year-on-year rate of 3.8% last month, up from 3.5% in July and ahead of the 3.7% consensus forecast.

Production materials cost 5.0% more than they did in August 2025, with inflation picking up from 4.8% in July. Consumer goods deflation eased to -0.5% from -0.8%, while durable goods inflation rose to 1.2% from 0.4%.

PPI inflation in China had risen to a four-year high of 4.1% in June, after turning positive in March, ending its longest period of wholesale deflation in decades that had lasted since September 2022.

Meanwhile, the consumer price index also rose at a sharper rate, picking up to 0.8% year-on-year in August from 0.5% the month before, though this was widely expected by economists.

Non-food inflation picked up to 1.2% from 0.9%, with transport costs surging 2.5% after a 0.4% gain previously on the back of higher fuel prices and increased demand.

Food deflation, however continued for the fifth consecutive month, with prices falling 1.4% after a 1.5% decline previously.

Core CPI inflation, which excludes the more volatile food and energy items, accelerated to 1.0% from 0.9%.