In this file:
· China’s pork price rockets 97 per cent in December, keeping inflation at eight-year high
· China’s Steadying Inflation Leaves Door Open for Monetary Easing
China’s pork price rockets 97 per cent in December, keeping inflation at eight-year high
Pressure increases on Chinese government to arrest pork crisis amid African Swine fever outbreak, with Lunar New Year approaching, where pork is a vital dish
The consumer price index (CPI) rose by 4.5 per cent in December, while the producer price index (PPI) continued to fall, dropping by 0.5 per cent last month
Finbarr Bermingham, Karen Yeung & Orange Wang, South China Morning Post (China)
9 Jan, 2020
China’s consumer inflation rose by 4.5 per cent from a year earlier in the last month of the decade, amid an African swine fever crisis which sent pork prices soaring by 97.0 per cent year on year.
Last month’s increase in the consumer price index (CPI) was flat from November, which was the highest since January 2012, and below an analyst poll by Bloomberg, which forecast 4.7 per cent growth.
Within the CPI, food prices rose by 17.4 per cent in December from a year earlier, with pork prices nearly doubling, new data released by the National Bureau of Statistics (NBS) on Thursday showed. Prices for beef, mutton, chicken, duck and eggs rose between 7.3 per cent and 20.4 per cent, while vegetable prices were also up 10.8 per cent.
Non-food prices rose 1.3 per cent, while consumer goods prices rose 6.4 per cent and services prices increased 1.2 per cent.
China’s producer price index (PPI), the price manufacturers charge at the factory gate, remained in contraction for the sixth consecutive month at minus 0.5 per cent year-on-year in December, from minus 1.4 per cent in November. The figure was in line analysts’ forecasts of minus 1.4 per cent.
“Moderating food price inflation took the pressure off consumer price inflation while producer price deflation eased thanks to base effects and an increase in energy prices. The big picture is that demand-side pressures remain subdued, leaving ample space for policymakers to ease monetary policy,” said Julian Evans-Pritchard, senior China economist from Capital Economics...
... But it is consumer inflation that will cause the more severe headache in Beijing. The Lunar New Year will be celebrated early this year, at the end of January. Pork traditionally forms a key part of family meals and business banquets. This year, many families in China will be hard pushed to put pork, by far the most widely-eaten meat in China, on their dining tables.
The 97 per cent gain in the price of pork was still slower that the 110.2 per cent expansion in November.
“The tight supply of pork has further relaxed, with the positive changes in the pig production, the releases of the central and local frozen pork reserves, and increased imports,” Shen Yun, a senior statistician at the NBS, said in a statement...
China’s Steadying Inflation Leaves Door Open for Monetary Easing
via Yahoo Finance - January 8, 2020
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China’s consumer inflation steadied in December while factory price declines moderated, leaving room for monetary easing to cement a recent stabilization in economic growth.
The consumer price index rose 4.5% last month from a year earlier, matching November’s rate and halting the recent acceleration fueled by surging pork prices. The producer price index declined 0.5% from a year earlier versus a 1.4% drop in November.
While pork prices -- a key element in the country’s CPI basket -- rose 97% from a year ago, that was actually slower than increases seen in October and November. They fell 5.6% in December from November.
Rising food demand during the Lunar New Year holidays is set to fuel price increases in January, but beyond that price pressures may moderate. That gives the central bank room for additional stimulus if needed after it started the year by trimming the amount of cash that lenders must hold in reserve and signaled continued action in 2020 to reduce borrowing costs for companies.
“The PBOC is likely to continue to use interest rate and liquidity tools to loosen monetary conditions in 2020, though the easing will probably be less pronounced than last year,” David Qu, a China economist at Bloomberg Economics in Hong Kong, wrote in a note. “We expect the PBOC to stick to a stance of measured easing to counter the economic slowdown.”
For the year, consumer inflation for 2019 stood at 2.9%, in line with the government-set target of 3%, while producer prices declined 0.3%. Core inflation, which removes the more volatile food and energy prices, stabilized at 1.4% in December, signaling ongoing weakness in the broader economy.
China’s economy has shown signs...
Soaring pork prices keep China's inflation at 7-year high
Joe McDonald, Associated Press
Jan 8, 2019
BEIJING (AP) — Soaring pork prices that nearly doubled in December over a year ago kept inflation at a seven-year high despite government efforts to ease meat shortages caused by a disease outbreak, official data showed Thursday.
Surging inflation adds to challenges for communist leaders who are trying to shore up slowing economic growth and resolve a tariff war with Washington.
The price of pork rose 97% over a year earlier despite increased imports of China's staple meat and the release of thousands of tons from government stockpiles.
Food prices rose 17.4% and overall consumer inflation was 4.5%, well above the ruling Communist Party's official target of 3%. That matched November's inflation, the highest since 2012.
China produces and consumes two-thirds of the world's pork but supplies plunged as authorities destroyed pigs and blocked shipments to contain an outbreak of African swine fever that was confirmed in August 2018. Farmers have allowed herds to dwindle.
Global pork prices have climbed as Chinese importers buy more from Canada, Europe and other suppliers.
Beijing announced in September it would lift punitive tariffs imposed on U.S. pork...