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CPI seen high but views differ
By Wang Yanlin |
September 30, 2011, Friday
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Print Edition
Print Edition
CHINA will continue to see high inflation in September but analysts are divided over how high the figure will be.
Lian Ping, chief economist at the Bank of Communications, said September's Consumer Price Index, the main gauge of inflation, may rise 6 percent, but it will be the second straight month that the pace of gain has eased. The inflation hit 6.2 percent in August and a 37-month high of 6.5 percent in July.
Guohai Securities also predicted the CPI may be between 6 percent and 6.2 percent because of the effect of the government's tightening policies.
However, Lu Zhengwei, an economist at the Industrial Bank, projected September's inflation to rebound to above 6.3 percent on higher food costs due to the Mid-Autumn Festival.
But all analysts agreed the government won't impose any more interest rate increases to tame inflation.
"Policymakers used to stress only the fight against inflation, but now they also look at the economy's moderation and the tighter market liquidity," BoCom's Lian said.
China has raised the interest rates three times this year and hiked the reserve requirement ratio, which forced banks to put aside a record 21.5 percent of capital as reserves, six times.
"But China is also unlikely to loosen its policies anytime soon," Lian said. "The country has adopted a very cautious attitude toward policy changes amid uncertainties at home and abroad."
The Industrial Bank's Lu agreed. He expected inflation to ease noticeably in the fourth quarter, after a short-term rebound in September.
"The stable performance of China's trade and manufacturing can support the economy for a while. Considering the still high inflation, China won't ease its monetary policies," Lu said.
The National Bureau of Statistics is due to release key September and third-quarter economic data in the middle of October.
Lian Ping, chief economist at the Bank of Communications, said September's Consumer Price Index, the main gauge of inflation, may rise 6 percent, but it will be the second straight month that the pace of gain has eased. The inflation hit 6.2 percent in August and a 37-month high of 6.5 percent in July.
Guohai Securities also predicted the CPI may be between 6 percent and 6.2 percent because of the effect of the government's tightening policies.
However, Lu Zhengwei, an economist at the Industrial Bank, projected September's inflation to rebound to above 6.3 percent on higher food costs due to the Mid-Autumn Festival.
But all analysts agreed the government won't impose any more interest rate increases to tame inflation.
"Policymakers used to stress only the fight against inflation, but now they also look at the economy's moderation and the tighter market liquidity," BoCom's Lian said.
China has raised the interest rates three times this year and hiked the reserve requirement ratio, which forced banks to put aside a record 21.5 percent of capital as reserves, six times.
"But China is also unlikely to loosen its policies anytime soon," Lian said. "The country has adopted a very cautious attitude toward policy changes amid uncertainties at home and abroad."
The Industrial Bank's Lu agreed. He expected inflation to ease noticeably in the fourth quarter, after a short-term rebound in September.
"The stable performance of China's trade and manufacturing can support the economy for a while. Considering the still high inflation, China won't ease its monetary policies," Lu said.
The National Bureau of Statistics is due to release key September and third-quarter economic data in the middle of October.
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