China's consumer inflation expanded at its fastest pace in more than eight years in January, as pork prices soared due to the coronavirus epidemic and stronger demand over the Lunar New Year period, official data released on Monday showed.
The consumer price index (CPI) rose 5.4 per cent from a year earlier, up from a 4.5 per cent gain in December, and at its highest point since October 2011, data from the National Bureau of Statistics (NBS) showed.
The result was above an analyst poll by Bloomberg, which forecast 4.9 per cent growth.
Within the CPI, pork prices jumped 116 per cent, as city lockdowns and transport restrictions due to the coronavirus outbreak hurt supply and demand. Overall food prices jumped 4.4 per cent month-on-month, which lifted the gauge by 0.96 percentage points.
The rise of CPI was mainly due to increased demand over the Lunar New Year and the impact of the virus, and also due to a lower base last year as the Chinese holiday was in February 2019, the NBS said in a statement.
"The virus outbreak has rewritten the supply and demand story in China, with supply staying at a relatively low level except for the medical sector and demand also falling," said Tommy Xie, an economist at Oversea-Chinese Banking Corporation in Singapore.
"Prices will likely continue to rise due to weak supply," and China is likely to export inflationary pressures globally, as demand will fall faster than Chinese supply does, he said.
The world's second largest economy faces mounting pressure due to the novel coronavirus outbreak, as factories stay closed and millions of consumers remain holed up at home.
The virus outbreak has rewritten the supply and demand story in China, with supply staying at a relatively low level except for the medical sector and demand also fallingTommy Xie
As the virus has spread from central Chinese city of Wuhan, authorities have taken unprecedented steps to control the outbreak, locking down more than a dozen cities in Hubei province home to tens of millions of people, curbing transport and reducing shop hours.
Consumer inflation in Hubei grew 1.5 per cent from December and 5.5 per cent from a year earlier. The NBS said the data was "positive" as the increase was roughly in line with the national figure.
The producer price index (PPI), reflecting the prices that factories charge wholesalers for their products, rose 0.1 per cent year-on-year in January, an improvement on the 0.5 per cent contraction in December, and slightly better than analysts' predictions.
Julian Evans-Pritchard, senior China economist at Capital Economics, said the virus appeared to have had little effect on the PPI last month.
"But it may simply be too soon to see the impact of the hit to demand on prices as factories were closed during the last week of the month due to the Chinese New Year holiday," he said.
"Recent moves in commodity prices suggest that we will see more of a drag on factory-gate prices this month."
Further pressure on consumer prices this year from the coronavirus outbreak would depend on how quickly production and transport could be resumed, said Ding Shuang, chief Greater China economist of Standard Chartered Bank.
"If the number of confirmed cases peaks this month and the epidemic can be contained in March, its impact on 2020 consumer prices will not be significant."
Of greater concern, however, will be the impact on overall economic growth, which the bank estimated to slow to 4.5 per cent in the first quarter from 6.0 per cent in the previous one.
Correction: This story has been updated to reflect consumer prices are at an eight-year high, not a nine-year high as was first reported.
Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.
Malaysia jails Indian man linked to fresh coronavirus outbreak
Head of Jakarta Tourism Agency Dies of Heart Attack
National COVID-19 task force chief Doni Monardo volunteers for COVID-19 vaccine ...
Trump hair rinsing complaints prompt US to ease shower standards
Gold jumps on dollar slide, slow U.S. labor market recovery
ByteDance censored anti-China content in Indonesia until mid-2020: Sources
Research explains why Susi Pudjiastuti was left out of Jokowi’s second-term cabinet
The Conversation Indonesia
Chinese Cities Find Coronavirus in Frozen Food Imports, WHO Downplays Risk
COVID-19 Positivity Rate Hit 8.7%; Anies Baswedan Prolongs Transitional PSBB
20 Percent Indonesians Not Wearing Face Masks, Health Ministry Says
Queensland becomes first Australian state to outlaw gay conversion therapy
Epidemiologist Suggests Jakarta Not Extend Transitional PSBB Again
Paling Banyak Komentar
Rio Dewanto Beri Dukungan untuk Jerinx, Gaungkan Tagar #BebaskanJRXSID
kumparan`` 8 40
Kronologi Pria yang Tewas di Kelapa Gading, Ditembak 4 Kali dari Belakang
Kompas.com`` 35 26
Misteri Ikan Mas Jumbo di Danau Toba, Jadi Mitos hingga Dikatikan dengan Peristiwa Alam
Boombastis.com`` 17 21
Kritik Tompi terhadap Film Indonesia: Penulis Naskah Harus Lakukan Riset
Kompas.com`` 8 10
Viral! Sudah Tawar Sadis, Pelanggan Ini Malah Maki Penjual “Ngapain Ngurusin Packaging Nanti Jadi Sampah”
Trending Now!`` 15 56
Ilmuwan Ingatkan Manusia Saat Ini di Titik Terdekat Kiamat
Bisnis.com`` 7 6
Remaja 14 Tahun Tertipu, Habiskan 1 Miliar Uang Ayahnya untuk Wanita di PUBG
Dunia Games`` 0 6
Bagikan Makanan Gratis hingga Bikin Gerakan Bersih Pantai, Inilah Kebaikan Sosok Jerinx yang Patut Ditiru
Boombastis.com`` 4 7
7 Kisah Pengorbanan Paling Heroik dan Sedih dalam Film
IDN Times`` 2 5
Urban Legend, Kisah Hantu Boneka Uci di Bandung
kumparan`` 43 15
Suami Pergoki Perselingkuhan Istri dari Google Maps
TomoNews`` 19 3
Lupakan Sancho, Manchester United Buang Rp12 Triliun Demi Bintang Real Madrid
INDOSPORT.com`` 2 5
Sri Mulyani Unggah Foto Bareng Jokowi, Cerita Krisis Dahsyat dan Bank Bangkrut
kumparan`` 24 14
Marc Lépine, Misoginis yang Membantai Puluhan Wanita di Kampus
kumparan`` 2 7
[Kata Gaul] Sudah Tahu Arti 'SPUPET'? Ini Dia Artinya
Daeng_Hermanto`` 31 393