China’s Inflation Probably Surged to 11-Year High in January

From Bloomberg:

China’s probably surged to an 11-year high in January, ratcheting up pressure on the government to rein in prices without derailing the world’s fastest-growing major economy.

Consumer prices rose 7 percent from a year earlier, according to the median estimate of 23 economists surveyed by Bloomberg News, after gaining 6.5 percent in December. The statistics bureau will release the figure at 10 a.m. tomorrow.

The ruling Communist Party’s efforts to tame inflation risk sapping the economy just as the nation recovers from the worst snowstorms in 50 years and the U.S. curbs its appetite for Chinese goods. China’s tools for cooling price gains this year will be bank reserve requirements, price caps and currency gains, not interest-rate increases, according to Wang Qing, chief China economist at Morgan Stanley in Hong Kong.

February 17, 2008, 5:46 PM
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Categories: Economy