CICC: It is expected that the year-on-year producer price index (PPI) and consumer price index (CPI) will still have room for growth in the next two months.

The CMP analysis of the price data for April 2026 shows that the PPI rose by 1.7% month-on-month, with the year-on-year increase expanding from 0.5% in the previous month to 2.8%. The increase in PPI exceeded expectations, mainly due to the fact that price hikes were highly concentrated in the energy and chemical industry chains. In April, the CPI rose by 0.3% month-on-month, stronger than seasonal trends, and the year-on-year increase in CPI also rose from 1.0% in the previous month to 1.2%, mainly driven by the boost from energy prices and holiday travel demand. Looking ahead, CMP believes that amid the ongoing negotiations between the US and Iran, international oil prices are likely to remain volatile at high levels, with a delayed transmission of oil price shocks. It is expected that in the next two months, both PPI and CPI will continue to rise year-on-year. However, this round of price adjustments on the production side is showing significant structural differentiation, with upstream price increases significantly higher than downstream. In an environment of weak end consumer demand, cost-push inflation may continue to suppress profitability in the middle and lower segments of industries.