BIZCHINA / News
China's CPI rises 3.3% in March
(Xinhua)
Updated: 2007-04-20 11:22
China's consumer price index (CPI) rose 3.3 percent in March compared
with a year ago, Li Xiaochao, spokesman with the National Bureau of
Statistics, said on Thursday.
The index, a main gauge of inflation, is the highest in 25 months after
it hit 3.9 percent in February 2005.
Li said at a news conference that the consumer price index in the first
quarter of this year climbed 2.7 percent, 1.5 percent higher than for the
first three months last year.
He said the CPI in March was 0.3 percent lower compared with February,
adding that food prices had soared 6.2 percent between January and March.
"The overall prices remain stable, but there exists inflation pressures
as grain and oil prices remain high," he said. The Chinese government has
set a target of three percent for this year's CPI.
Cai Zhizhou, a researcher with Peking University, said the government
should pay more attention to the grain and oil prices, the major drivers
of inflation, as they were very high compared with early last year.
Zhuang Jian, Beijing-based economist with the Asian Development Bank,
said the rapid economic growth, the abundant liquidity and rising
household incomes all contributed to the inflation surge.
"Inflationary pressure will continue to build as there is scant
possibility of grain price cuts, while prices of gas, electricity and
water are set to rise in the future," Zhuang said.
Li noted China's GDP expanded 11.1 percent year-on-year in the first
quarter. He added that the M2, the broad measure of money supply that
covers cash in circulation plus all deposits, jumped 17.3 percent to
36.41 trillion yuan (US$4.72 trillion) at the end of March.
He said that China would continue to strengthen macro-control measures to
solve problems that include excessive liquidity and a huge international
payments surplus.
Analysts said the huge payments and trade surpluses had boosted
liquidity, which had in turn fueled inflation. China's trade surplus
reached 46.4 billion yuan in the first quarter, double that of the same
period last year.
(For more biz stories, please visit Industry Updates)
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