Surging food prices to drive CPI in April
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Agricultural food prices rose 5 percent between March 29 and April 25 compared with the same period a year back. The increase was led by a 32.3 percent surge in vegetable prices, and a 4.2 percent and 6.6 percent hike in egg and fishery product prices, according to data from the Ministry of Commerce.Some analysts said rising pork prices would also spur an increase in the CPI.
Food accounts for 33.2 percent of the CPI pie, with pork accounting for 9.26 percent of the food category.
Since mid-April, pork prices have shown continual rebound for two weeks with chain gains of 0.2 and 0.5 percent respectively, according to Ministry of Commerce. The pork reserve purchase initiated by the ministry on April 13 is seen as an indicator of continuous price increases in the next few months. "But the pork price would contribute little in the April data as it slowed by 5.2 percent during the month," said Dong.
He Zhicheng, a senior analyst with Agricultural Bank of China, said the high purchasing price index would also add fuel to the flames, while the conduction effect from the surging producer price index is surfacing gradually.
He said the CPI growth might exceed 3 percent in April and reach 5 percent in the second quarter of 2010.
But not all economists concur with the view. Zhou Mingjian, an analyst with Pacific Securities, said CPI growth would stay between 2.4 to 2.6 percent in April, and will not exceed 3 percent until June due to the relatively high basis in the same period last year.
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