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Festival adds steam to consumer price inflation
By Wang Yanlin |
January 26, 2011, Wednesday
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Online Edition
Online Edition
CHINA'S consumer prices may pick up again in January due to fast growing food prices prior to the Spring Festival after a moderation in December, analysts said today.
Consumer Price Index, the main gauge of inflation, is likely to climb above 5 percent again this month, said Li Maoyu, an economist at the Changjiang Securities Co.
"Frequent natural disasters in recent months led to stronger increase in food prices at this holiday season when the Spring Festival fuels demand," Li said. "Even if government measures are well implemented, a higher inflation rate may be unavoidable."
His view echoed that of Matt Robinson, a senior economist at Moody's Analytics. Robinson suggested policymakers need to bolster supply to curb seasonal food price inflation.
According to the Ministry of Commerce, prices of 18 vegetables tracked by the ministry rose 12.6 percent year-on-year last week, 6.5 percentage points more than the previous week. Price of mutton jumped 1.4 percent from a year earlier, while beef and pork were 0.8 and 0.7 percent more expensive respectively.
Before the Spring Festival holiday, a traditional peak period for consumer sales, which starts next Wednesday, China has suffered heavy snow in the east, icy rain in the south and droughts in the central region. Weather disasters aggravated the country's inflation.
China's consumer prices gained 4.6 percent year-on-year in December, slower than November's 28-month high of 5.1 percent, but still beyond the market expectation of 4.3 percent.
Consumer Price Index, the main gauge of inflation, is likely to climb above 5 percent again this month, said Li Maoyu, an economist at the Changjiang Securities Co.
"Frequent natural disasters in recent months led to stronger increase in food prices at this holiday season when the Spring Festival fuels demand," Li said. "Even if government measures are well implemented, a higher inflation rate may be unavoidable."
His view echoed that of Matt Robinson, a senior economist at Moody's Analytics. Robinson suggested policymakers need to bolster supply to curb seasonal food price inflation.
According to the Ministry of Commerce, prices of 18 vegetables tracked by the ministry rose 12.6 percent year-on-year last week, 6.5 percentage points more than the previous week. Price of mutton jumped 1.4 percent from a year earlier, while beef and pork were 0.8 and 0.7 percent more expensive respectively.
Before the Spring Festival holiday, a traditional peak period for consumer sales, which starts next Wednesday, China has suffered heavy snow in the east, icy rain in the south and droughts in the central region. Weather disasters aggravated the country's inflation.
China's consumer prices gained 4.6 percent year-on-year in December, slower than November's 28-month high of 5.1 percent, but still beyond the market expectation of 4.3 percent.
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