China’s producer prices continued to fall in February, but the decline has narrowed in a tentative sign of improved aggregate demand, data from the National Bureau of Statistics showed on March 10.

The producer price index, a measure of costs for goods at the factory gate, fell 4.9 percent year on year, narrowing from a 5.3-percent drop in January and 5.9 percent in December.

The reading also marked the 48th straight month of decline as China’s economic slowdown and industrial overcapacity weighed on prices.

HSBC chief China economist Qu Hongbin attributed the easing contraction to stabilizing commodity prices during the period.

Month on month, producer prices in February edged down 0.3 percent.

Output prices of production materials fell 6.5 percent in February, contributing 4.8 percentage points to the PPI drop during the month, while those of consumer goods edged down 0.4 percent during the period.

The data came along with the release of the consumer price inflation index (CPI), which rose to 2.3 percent as cold weather and Spring Festival demand pushed up vegetable prices.

But Qu pointed out that the rise in inflation was mostly caused by temporary factors, and downward pressure on non-food prices still looms large.

“The deflationary risks see no significant easing,” he noted.

According to a government work report delivered by Premier Li Keqiang at the annual legislative session last week, China aims to hold this year’s consumer price growth at around 3 percent.

The target is unchanged from that for 2015, but the consumer price index only rose 1.4 percent last year, a six-year low.