Southwest Drought Into A New Variable This Year’s Price

HC plastic mesh News: With the second half of last year show the effectiveness of monetary control gradually, in February China’s consumer price index (CPI) in the Spring Festival, driven by only 2.7%, more than 3% lower than previously expected. However, the Southwest continued drought pushed up food prices people are agricultural concerns, so that would have control of CPI has been gradually re-emergence of a new variable. Affected Financial Agencies have forecast in March CPI price will be close to the previous month. A macro-2009 Economy Data the most accurate forecast of brokerage analysts called the chief macroeconomic analyst at CITIC Securities expects Jian-Fang Zhu, March CPI will reach 2.6% Other Agency forecast price data with little difference. Focus on a control

this has been noticed Annual Spring Festival, due to festive needs, the month, there is often a more substantial price rise. As the Spring Festival in February this year my last year in January, so in February this year, prices rose significantly, reaching 2.7%. For this data, “can be said to have lower than market expectations, indicating the State had effective control on prices.” Vice president of Renmin University Liu Yuanchun said. He put forward three reasons:

First, in January, February is usually New Year effect, hikes resulted from the more serious when the base effect, the two base reference of relatively poor. Therefore, excluding use Food And fuel prices CPI?? Core CPI measure. February CPI rose 2.7%, there is 2.05% because of rising food prices caused by the core CPI is only about 0.4%, which indicates that China’s macroeconomic situation is a basic balance between supply and demand.

Secondly, Liu Yuanchun that why people think that the future inflation is high, a core reason is that last year, banks put in a lot of money. China’s M2 rose in February 25.6%, M1 rose by 34.4% in China over the past decade a high level. But we have to see China’s current monetary policy has begun to shrink substantially. From the theoretical calculation in terms of, M2 to CPI is generally the transmission cycle of a normal year for 10 months, the crisis year of an 11-month to 12 months. Passing from the normal terms, it is precisely in January, February is the high point of monetary shocks. However, in 2005, China’s currency to the inflation transmission mechanism has the revolutionary changes in the financial sector had a strong reservoir effect, greatly easing the monetary impact of adjustment on entities in the field, so February’s CPI will be low the market expected.

In addition, many people believe that the current cost-push inflationary pressures larger reason. China’s industrial producer prices in February ( PP I) 5.4%, fuel power, fixed asset price index of near 10%. However, to note that the Chinese economy is the biggest change in technology to enhance and improve the scale, so that Chinese companies significantly raise the cost of digestion, so the impact of cost shocks on prices is also reduced.

2 CPI data just released, the State Council Development Research Center, Ba Shusong, deputy director of Institute of Finance had predicted: “March CPI growth rate might drop significantly and may affect the tone of the policy.”

Focus 2 Southwest drought into a new variable

However, many researchers believe that the economic situation is becoming uncontrollable price when the drought occurred in southwest China, which became the current issue price of new variables.

Since autumn last year, including Guangxi, Chongqing, Sichuan, Guizhou, Yunnan, southwest China, including history, suffered a devastating drought, millions of hectares of agricultural crops at present. Member of the CPC Central Committee Political Bureau, Vice Premier Hui Liangyu on April 1st at the State Flood Control and Drought Relief Headquarters Command chaired a State Council special meeting, the meeting emphasized that the continuing drought in southwest China, the country still in the development of drought, drought disaster reduction a difficult task; Huang and continuous low temperature in North China winter wheat region, seriously affecting spring sowing in spring tube, the situation facing agricultural production is not optimistic.

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