China Says October Inflation Rose 6.5 Percent Despite Efforts to Restrain Price Rises.
China's consumer prices rose sharply in October, tying a decade-high monthly inflation rate of 6.5 percent, the government reported Tuesday, adding to pressure for measures to cool a politically sensitive surge in food prices.
Food prices jumped 17.6 percent in October over the same month last year, while the price of pork, China's staple meat, soared 54.9 percent, according to the National Bureau of Statistics. The overall October inflation rate was higher than the 6.2 percent reported in September and matched August's 6.5 percent, the highest rate in 11 years.
"We expect more monetary tightening to rein in inflation, including further rate hikes," Lehman Bros. economist Mingchun Sun said in a report to clients.
Inflation has surged in recent months due to double-digit increases in food prices blamed on shortages of pork and other basic goods. The food price spike is especially sensitive for the communist government, because China's poor majority spends as much as one-third of its income on food.
A deputy central bank governor said last month the government expects inflation for the full year to be 4.5 percent, overshooting the official target of 3 percent. Inflation for nonfood items in October was just 1.1 percent, the statistics bureau said.
Beijing froze prices of cooking oil and other basics in September, and is pressing farmers to raise more pigs, promising free vaccinations and other aid. Economists say price pressure should ease when a new grain crop is harvested and more pigs come to market. Farmers had been reluctant to raise more pigs in part because of an outbreak of blue ear disease, which killed 70,000 animals and prompted the government to destroy thousands more. The government declared last week it had brought the outbreak under control.
An official of China's top planning agency, the cabinet's National Development and Reform Commission, said in October that the government would considering investment curbs and other unspecified "measures to adjust prices." The government said in October that pork prices fell in August due to increased supplies. There was no immediately explanation Tuesday for the sharp price increase in October.
Regulators raised state-set prices for diesel and gasoline by 10 percent on Nov. 1 in an effort to curb demand amid a fuel shortage. But the government said that should add only 0.05 percentage point to the monthly inflation rate.
The government has raised interest rates repeatedly this year to curb a boom in construction and investment that regulators worry could lead to financial problems. Economists say the recent inflation spike is due to food shortages and has nothing to do with those concerns.
China's consumer prices rose sharply in October, tying a decade-high monthly inflation rate of 6.5 percent, the government reported Tuesday, adding to pressure for measures to cool a politically sensitive surge in food prices.
Food prices jumped 17.6 percent in October over the same month last year, while the price of pork, China's staple meat, soared 54.9 percent, according to the National Bureau of Statistics. The overall October inflation rate was higher than the 6.2 percent reported in September and matched August's 6.5 percent, the highest rate in 11 years.
"We expect more monetary tightening to rein in inflation, including further rate hikes," Lehman Bros. economist Mingchun Sun said in a report to clients.
Inflation has surged in recent months due to double-digit increases in food prices blamed on shortages of pork and other basic goods. The food price spike is especially sensitive for the communist government, because China's poor majority spends as much as one-third of its income on food.
A deputy central bank governor said last month the government expects inflation for the full year to be 4.5 percent, overshooting the official target of 3 percent. Inflation for nonfood items in October was just 1.1 percent, the statistics bureau said.
Beijing froze prices of cooking oil and other basics in September, and is pressing farmers to raise more pigs, promising free vaccinations and other aid. Economists say price pressure should ease when a new grain crop is harvested and more pigs come to market. Farmers had been reluctant to raise more pigs in part because of an outbreak of blue ear disease, which killed 70,000 animals and prompted the government to destroy thousands more. The government declared last week it had brought the outbreak under control.
An official of China's top planning agency, the cabinet's National Development and Reform Commission, said in October that the government would considering investment curbs and other unspecified "measures to adjust prices." The government said in October that pork prices fell in August due to increased supplies. There was no immediately explanation Tuesday for the sharp price increase in October.
Regulators raised state-set prices for diesel and gasoline by 10 percent on Nov. 1 in an effort to curb demand amid a fuel shortage. But the government said that should add only 0.05 percentage point to the monthly inflation rate.
The government has raised interest rates repeatedly this year to curb a boom in construction and investment that regulators worry could lead to financial problems. Economists say the recent inflation spike is due to food shortages and has nothing to do with those concerns.
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