Overall Situation: Low-Level Bottoming - In December 2025, the price indicators continued to improve, with CPI year-on-year rising from 0.7% to 0.8%, and PPI narrowing from -2.2% to -1.9% [2][11] - For the year 2025, CPI is expected to be 0%, slightly lower than the 0.2% in 2023 and 2024, while PPI is projected at -2.6%, lower than -2.2% in 2024 [12][11] CPI: From General Weakness to Structural Improvement - CPI was reclassified into categories: food (approx. 19% weight), competitive goods (approx. 26%), competitive services (approx. 19%), rent (approx. 15%), and government-controlled goods and services (approx. 21%) [15][18] - The cumulative CPI growth for 2023-2024 averaged -0.1%, indicating a general price weakness influenced by production capacity cycles and domestic supply-demand imbalances [19][18] - In 2025, CPI cumulative growth is expected to be 0.8%, showing structural improvement, driven by rising prices in food (1.1%) and gold jewelry (68.5%) [20][21] PPI: Accelerated Decline Followed by Stabilization - In the first half of 2025, PPI showed a month-on-month decline of -0.3%, while in the second half, it stabilized with a month-on-month average of 0% [5][23] - The price of various industry chains, particularly in non-ferrous metals, is expected to improve due to macroeconomic factors and domestic capacity management [24][23] Outlook for 2026: Mild Year-on-Year Recovery - CPI and PPI are expected to see mild year-on-year recoveries, with CPI projected at approximately 0.8% and PPI at around -1% [26][27] - Potential drivers for CPI improvement include rising prices in food and competitive goods, particularly gold jewelry, and healthcare services [27][28] December 2025 Inflation Data Review - CPI rose from 0.7% to 0.8%, with food prices increasing from 0.2% to 1.1%, while energy prices fell from -3.4% to -3.8% [29][30] - Core CPI remained stable at 1.2%, with significant increases in gold jewelry prices and household goods [29][30]