December CPI expected to fall below 5%
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China's consumer price index (CPI), which gauges inflation, is expected to fall back below 5 percent for last December, the National Business Daily reported Tuesday, citing institutions' forecast reports.
According to the latest report by Shenyin & Wanguo Securities, December’s CPI will fall to 4.5 percent, compared with 5.1 in November. However, the decrease in CPI is only temporary, the report stated, adding that China's commodity prices will surge over 5 percent in the first half of 2011. Shenyin & Wanguo predicted that China will have to use interest rates, reserve requirement rates and the currency exchange rate to deal with inflationary pressure.
The Bank of Communications predicted December's CPI to hit 4.1 to 4.7 percent, with the median forecast being 4.4 percent. Based on these numbers, China's full-year CPI in 2010 is expected to rise by about 3.3 percent, a little more than the 3-percent inflation target set by the Chinese government at the beginning of last year.
China's business press carried the story above on Tuesday. China.org.cn has not checked the stories and does not vouch for their accuracy.
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