SHENZHEN – Prices of goods leaving Chinese factories climbed for the first time in more than three years as global energy costs surged due to the war in Iran.

China’s producer price index rose 0.5 per cent in March 2026 from the previous year, snapping 41 consecutive months of decline, according to data released on April 10 by the National Bureau of Statistics.

Consumer prices rose 1 per cent year on year, down from the previous month of 1.3 per cent but still coming in above 2025’s full-year reading of zero.

Some analysts say such imported inflation may do little to boost the economy and could end up hurting firms’ bottom lines and the domestic consumption which Beijing hopes to lift.

But others see a silver lining in a slight increase in prices, which could shake the world’s second-largest economy out of a years-long deflationary mindset.

For now, the latest figures are “a welcome step towards exiting deflation, which Beijing has targeted”, said Ms Alicia Garcia-Herrero, chief economist for the Asia-Pacific region at Natixis, an investment bank.

But they do not yet mark a decisive turning point for China, she added, as the rebound appears driven mainly by imported energy costs rather than broad domestic demand.

China has been contending with a long streak of deflationary pressures that have weighed on its economy. Weak demand and excess supply have led businesses to slash prices, which squeezes profits and constrains wages, which in turn holds back new consumer spending.

Policymakers pledged in the government’s work report for 2026 to “steer general price levels back into positive territory”.

Beijing has moved to combat overcapacity and cut-throat competitio...