Inflation in China was lower in March than in February, due to weak demand caused by the lockdown against the new corona virus. Inflation was 4.3 percent year-on-year, from 5.2 percent in February. That is the lowest level since October. Economists had generally expected a stronger price increase.
Demand for goods remained weak despite easing government restrictions against the lung virus. As a result, factories were paid lower prices for their products. In addition, prices for foodstuffs such as pork, vegetables and fruit rose less rapidly, due to the lifting of certain restrictions on supply. Furthermore, the sharp fall in oil prices depressed inflation.
Chinese core inflation, which does not take food and energy prices into account, rose slightly to 1.2 percent in March. In February this was still 1 percent. That is still a fairly low level.