Inflation jumps in China
Beijing, March 13:
China announced a jump in inflation Tuesday that, combined with a near-record trade surplus, heightened expectations the government may raise interest rates and adopt other tightening measures.
The consumer price index, the main gauge for inflation, rose 2.7 per cent in February compared to the same period a year ago, just below the three-per cent upper limit set by the central government, the National Bureau of Statistics reported.
“The central bank will wait for a situation to emerge where the inflationary pressure is obvious before hiking interest rates,” said Sun Fanghong, a Shenzhen-based analyst with Ping An Securities.
“But if the trend continues upwards in March, then the chance of a rate hike is very big,” Sun said.
The inflation figure compared with a 2.2 per cent increase in January, and an unexpected spike of 2.8 per cent in December. Consumer prices rose 1.5 per cent for full-year 2006.