? ?
BIZCHINA / Macro Economy
Consumer inflation jumps to 11-year high
By Dong Zhixin (chinadaily.com.cn)
Updated: 2007-09-11 10:34
Consumers shops for pork at a supermarket in Suzhou, East China's Jiangsu
Province?September 7, 2007. [newsphoto]?
Consumer inflation in China jumped to the highest level in nearly 11
years in August as food prices continue to surge, raising the possibility
for another interest rate hike.
The Consumer Price Index (CPI), a barometer of inflation, rose 6.5
percent year-on-year in August after a 5.6 percent increase in the
previous month, the National Bureau of Statistics said Tuesday in a
statement on its website.
The growth beats the six-percent expectation most economists had, and is
well above the official target of three percent for the whole year.
Meanwhile, the Producer Product Index (PPI), a measure of inflation?at
the wholesale level, increased 2.6 percent in August, 0.2 percentage
point higher than in July, the bureau said on Monday.
That marked a reversal from a steady slowdown in PPI in the past few
months, which analysts said indicated that inflationary pressure is
spreading from the consumer sector to other sectors of the economy.
In a breakdown of August's CPI figures, food prices jumped 18.2 percent
year-on-year, while non-food items rose only 0.9 percent, the statement
showed.
Among foodstuffs, meat and meat products reported the biggest increase,
up 49 percent, followed by a 34 percent hike in cooking oil, and a 23.6
percent rise in eggs. Grain prices went up 6.4 percent.
In August, rural areas saw a 7.2 percent price increase, compared with
6.2 percent for urban areas, according to the bureau.
From January to August, the CPI growth was 3.9 percent, the bureau said
in the statement.
Related Readings:
'No threat of big rise' in inflation
Inflation surges to 10-yr high
Interest rate raised to curb inflation
Central Bank Governor Zhou Xiaochuan expressed his concerns about
inflation on Monday at a meeting in Switzerland. "Curbing inflation is
our objective," he said.
Earlier this month, Zhou said his agency hoped to turn the real interest
rate positive, indicating more interest rate hikes may come in the next
few months.
China has raised interest rates four times so far this year, with the
last one on August 21 when the benchmark one-year deposit rate rose to
3.60 percent.
However, the return on deposits is still below the inflation rate,
indicating a loss of purchasing power if people put their money into
banks.
That is encouraging an exodus of bank deposits to the country's red-hot
stock market, which has doubled so far this year.
(For more biz stories, please visit Industry Updates)
Learn Chinese, Learn mandarin
No comments:
Post a Comment