Fallout From China’s Quake Could Include Inflation

From Los Angeles Times:

The powerful earthquake that rattled Sichuan province is not expected to hamper China’s economic growth, but it could ripple through the economy in one significant way: inflation.

Sichuan accounts for just 4% of the nation’s gross domestic product and less than 2% of the country’s foreign trade and investment. But the south-central province is the nation’s leading pig-farming region and a large producer of grains.

Prices for pork, a staple of the Chinese diet, have soared over the last year, helping fuel China’s inflation to levels unseen in more than a decade. In April, consumer prices rose 8.5% from a year earlier, well above the government’s annual inflation target of 4.8%.

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