China may revise CPI goal upwards to 4%
By Wang Yanlin |
October 15, 2010, Friday
|
Print Edition
Print Edition
THE Chinese Academy of Social Sciences warned that China may have to raise its annual inflation target just a week before September data are expected to show consumer prices at a two-year high.
The academy, in a report, suggested the government may have to revise its inflation target for the year to 4 percent from 3 percent.
China's consumer price index, due to be released next Thursday, is expected to show costs of grain, rice and other foods leading the indicator higher by between 3.4 percent and 3.9 percent for September.
"Rising food costs are a main source of higher consumer prices," said Li Maoyu, an analyst at Changjiang Securities Co. "With residential energy prices set to rise, inflationary pressure may remain longer than expected."
Li is forecasting a September CPI of 3.5 percent, unchanged from August.
Other economists are predicting inflation as high as 3.9 percent.
Bank of Communications said prices may increase as much as 3.7 percent from a year earlier, hitting a two-year high.
Consumer prices in China rose at the fastest pace in 22 months in August, compared with advances of 3.3 percent in July and 2.9 percent in June.
The academy said a higher inflation target would allow more farm incomes, help soak up excess liquidity and alleviate pressure for the appreciation of the yuan.
The academy, in a report, suggested the government may have to revise its inflation target for the year to 4 percent from 3 percent.
China's consumer price index, due to be released next Thursday, is expected to show costs of grain, rice and other foods leading the indicator higher by between 3.4 percent and 3.9 percent for September.
"Rising food costs are a main source of higher consumer prices," said Li Maoyu, an analyst at Changjiang Securities Co. "With residential energy prices set to rise, inflationary pressure may remain longer than expected."
Li is forecasting a September CPI of 3.5 percent, unchanged from August.
Other economists are predicting inflation as high as 3.9 percent.
Bank of Communications said prices may increase as much as 3.7 percent from a year earlier, hitting a two-year high.
Consumer prices in China rose at the fastest pace in 22 months in August, compared with advances of 3.3 percent in July and 2.9 percent in June.
The academy said a higher inflation target would allow more farm incomes, help soak up excess liquidity and alleviate pressure for the appreciation of the yuan.
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