26 September 2018
Customers buy products at a supermarket in Huaibei


China’s consumer price index (CPI) rose 3.2 percent in October from a year earlier, marking the fastest pace in eight months, the National Bureau of Statistics (NBS) said Saturday.

A 6.5 percent year-on-year gain in food prices was the major driver for the CPI growth last month. Prices of vegetables surged 31.5 percent while those of meat were up 5.8 percent.

However, in terms of month-on-month growth, food prices actually fell 0.4 present last month from September while non-food prices recorded a 0.3 percent growth, the NBS said. Prices of tourism products rose 4.9 percent while clothing prices were up 1.1 percent.

In the first ten months, CPI rose 2.6 percent from the same period last year. Given the trend so far, authorities are likely to meet the target to cap the inflation rate at 3.5 percent for the whole year.

Yu Qiumei {余秋梅}, a senior statistician at the NBS, said the CPI has shown a stable trend so far this year. However, Niu Li {牛犁}, a researcher at the National Information Center, warned that hot money has been flowing into China recently due to the country’s stabilizing economic growth and rising pace of renminbi appreciation. The country will suffer an inflationary risk if such trend intensifies, he said.

In fact, renminbi appreciation has regained momentum since the US Federal Reserve in mid-September skipped a widely-expected tapering of its quantitative easing program. If the Fed decides to continue its debt purchase plan in December, China will probably have to face stronger inflationary pressure next year. The inflation rate may rebound to 3 to 4 percent level in 2014, observers say.

Think-tank urges nationwide property tax in 2015

A research team under the China Center for International Economic Exchanges (CCIEE), a government-backed think-tank, has urged the central government to implement the property tax nationwide in 2015, the China Securities Journal reported Monday. A four-tier taxation plan sets higher rates for owners of more than one home while granting exemption to those with only one, according to the newspaper. Meanwhile, the CCIEE researchers proposed that consumption tax be imposed at the local level.

Shenzhen bourse to check malpractices by listed firms

The Shenzhen Stock Exchange will blacklist listed firms that engage in improper speculative activity, as part of efforts to strengthen market supervision, Shanghai Securities News reported Monday, citing an unnamed bourse official. Some firms have been actively investing in non-core businesses to fuel rumors of acquisitions and reorganization. Once the stocks of those companies shoot up, the firms’ shareholders unload their stakes for hefty profits. Authorities are seeking to curb such activities. The bourse will disclose more information to investors on stocks under speculation risk, the report said.

PBoC mulls fees for interbank services

The People’s Bank of China is consulting with banks on a proposal to charge fees for various online interbank services, such as real-time fund transfers and account enquiries, China National Radio reported Sunday. Sources close to the central bank said it is necessary to levy fees on participating banks for such services, which have been imposing additional pressure on the system. However, there are growing worries that banks would pass on such fees to consumers, the report said.

– Contact HKEJ at [email protected]

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