In January 2026, the CPI increased by 0.2% year-on-year, remaining flat month-on-month, mainly due to the high base effect from the Lunar New Year falling in a different month. Food prices declined by 0.7% year-on-year, and energy prices were significantly dragged down. The core CPI rose by 0.3% month-on-month, reaching a new high in nearly six months, reflecting the resilience of service consumption and industrial product demand. The PPI narrowed its year-on-year decline to -1.4%, with four consecutive months of positive month-on-month growth, indicating an improvement in supply and demand in the industrial sector. This CPI base period rotation added new consumption categories such as automotive electricity and elderly products, with increased service weights to enhance sensitivity to the consumption recovery. Institutions expect the CPI year-on-year to rebound to 1.3% in February, and the PPI year-on-year is expected to turn positive in the second quarter.