China’s producer prices dropped 1.4% year-on-year in January 2026, slowing from a 1.9% fall in December and extending the contraction to a 40th consecutive month. The latest reading was slightly below market expectations of a 1.5% fall, marking the mildest decline since July 2024, reflecting Beijing’s continued efforts to rein in excessive price competition. Production material prices fell much more slowly (-1.3% vs -2.1% in December 2025), with decreases softening in raw materials (-2.0% vs -2.6%) and processing (-0.4% vs -1.6%), while mining dropped at a faster pace (-8.1% vs -4.7%). Consumer goods prices declined at a faster pace (-1.7% vs -1.3%), driven by steeper falls in clothing (-0.7% vs -0.1%) and food prices (-1.9% vs -1.5%), while durable goods remained weak (-1.8% vs -3.5%). Also, the costs of daily-use goods fell faster (-1.8% vs 1.4%). Monthly, the PPI rose 0.4% in January, accelerating from a 0.2% rise in December, marking the fastest increase since September 2023.