China’s consumer prices held steady while the rate at which producer prices fell slowed during March, indicating the economy is heading for recovery, state-run news agency Xinhua reported this week.

The National Bureau of Statistics of China announced on Monday the consumer price index rose 2.3 percent in March compared to the prior-year period. The hike was at the same level as in February.

The producer price index, a gauge measuring wholesale prices at producer level, decreased 4.3 percent year-on-year in March. The decline was smaller than the 4.9-percent retreat and 5.3-percent drop recorded in February and January respectively.

“The upside surprise in factory gate prices is another indication that China’s economy is on slightly firmer ground heading into the spring,” said Tom Orlik, chief Asia economist at Bloomberg, quoted by Xinhua.

The easing in the decline of producer prices also showed a more robust demand in the industrial sector, he added.