A seasonal surge in consumption during the Chinese New Year holiday lifted China’s inflation in January for the first time in five months.
The country’s consumer price index rose 4.5% from a year earlier, China’s National Bureau of Statistics said Thursday, up from 4.1% a month earlier.
Prices traditionally rise during the weeklong lunar new year holiday in response to the massive boost in spending on gifts, food and services.
China has raised interest rates, bank capital reserve ratios and placed restrictions on the nation’s property market in an all-out effort to drive down inflation, which hit a three-year high over the summer.
Analysts say that battle is being won and expect inflation to settle below 4% in the coming months.
"Inflation is no longer policymakers’ chief concern," said Alistair Thornton, a Beijing-based analyst for IHS Global Insight.