National Bureau of Statistics data shows China's consumer price index (CPI) fell in February for the first time since January last year, as food, tobacco, and alcohol prices declined.
A 0.7% drop in the CPI last month reversed a 0.5% increase in January. Reuters' economists had forecast an annualised decline of 0.5%.
The CPI fell 0.2% month-to-month in February, compared to 0.7% growth in January.
China's GDP growth target for 2025 has been set at "around 5%" as investors watch for signs that Beijing's stimulus measures will spur economic recovery.
The government plans to boost domestic demand to stabilise growth.
ASIA Society Policy Institute reports that Beijing has revised its annual consumer price inflation target from 3% or higher to "around 2%" - the lowest in two decades.
Rather than a target, the new inflation goal should act as a ceiling.
Analysts are concerned that China's 5% growth target for this year may prove challenging since domestic consumption has been weak for a long time and trade tensions with the United States have escalated under President Donald Trump.
As Beijing attempts to stimulate economic growth amidst these hurdles, it has revised the inflation target to keep consumer prices in check.
Despite these obstacles, investors continue to monitor government policies to see if they are successful in reviving the nation's economy.
During the first two months of 2025, China's commodity imports slowed due to tightening sanctions, supply disruptions, and uncertainty regarding trade agreements.
In the months to come, however, additional stimulatory measures and seasonal demand are expected to keep import volumes resilient.
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