China's April CPI up 5.3%, PPI up 6.8%

Source: Globaltimes.cn
[16:05 May 11 2011]
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Sheng Laiyun, spokesman of National Bureau of Statistics of China (NBS) announced China's economic figures in April on May 11, 2011. Photo: Xinhua

China's consumer price index (CPI), a major gauge of inflation, grew 5.3 percent year-on-year in April, according to figures released by the National Bureau of Statistics (NBS) on Wednesday. The CPI figure is 0.1 percent lower than that of March.

China's producer price index (PPI), a major measurement of inflation of wholesale prices, grew 6.8 percent year-on-year in April, down 0.5 percentage points from March.

Food costs, the biggest constituent in the CPI basket, increased 11.5 percent year-on-year from last month, compared with the growth of 11.7 percent in March, contributing to an easing CPI rise.

Liu Yuanchun, deputy dean of the Economics School at Renmin University of China, said that China's soaring commodities price this year reflected global high inflation. The country is facing increasing inflation pressure from rises in global commodity prices, including crude oil and non-food.

Sun Junwei, analyst of HSBC said if the government's tightening efforts maintain for three to four months, the economic growth may slow down and further ease the long-time inflationary pressure in the second half of this year.

Analysts believe that curbing inflation has become the priority task for the government's monetary policy. China adjusted its deposit reserve ratio four times this year and raised the benchmark interest rates twice. Some organizations predicted that banks may raise the interest rates in late May or early June if CPI continues to rise.

CPI rose 5.4 percent year-on-year in March, 4.9 percent in February, the same as in January this year.

PPI rose 7.3 percent year-on-year in March, 7.2 percent in February and 6.6 in January.