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China has expanded its trade-in program to boost consumer spending on home appliances.
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The program, which was launched in March, includes subsidies and has shown positive results.
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China is facing economic challenges, including fears of inflation and low consumer demand.
China's cautious consumers costs less, prompting Beijing to produce incentives even for small household goods.
Wednesday, China additional home appliances, including microwave ovens, water purifiers, washing machines, and rice cookers, in a trade-in program designed to stimulate demand.
The program, which was first released in March, already included larger appliances such as refrigerators, washing machines, TV sets, and air conditioners. The Chinese government subsidizes up to 20% of the price of a new device.
The Chinese government, which had allocated 81 billion yuan, or $11 billion, for the trade-in program, said Wednesday that the program had yielded positive results.
Li Gang, an official of China's commerce ministry, said at a press conference on Wednesday that the trade program brought in 920 billion yuan worth of car sales and 240 billion yuan worth of home appliance sales last year.
China is trying to boost consumption in the world's second-largest economy, which is beset by a number of challenges including a property crisis and high youth unemployment.
Economists are particularly concerned about a deflationary spiral, which would result in a vicious cycle of reduced consumer demand and lower prices.
The official inflation data published on Thursday did not bring much joy, with China Consumer Price Index has changed so far 0.2% compared to the previous trading day.
In December, China's CPI rose just 0.1% over a year ago in its fourth straight month of contraction, with falling food prices dragging inflation down. In contrast, November's CPI was 0.2% higher than a year ago.
The headline inflation figure did not fall into inflation limits due to non-food inflation – which rose 0.2%.
However, the data on non-food prices “does not inspire too much confidence in consumption growth yet,” wrote Lynn Song, chief economist for Greater China at ING, Thursday.
Clothing, education and health care prices moved up in December.
However, the prices of transportation, communication, daily use goods, and rent were in the deflationary range.
Factory gate prices were in decline for the 27th straight month.
Analysts generally expect China's inflation data to pick up this month due to seasonal factors such as the Chinese New Year, which begins on January 29.
