September 12, 2011

Stubbornly high food costs continue to drive China's inflation

Soaring food price in China, which had gone up 13.4% last month, was to blame for sending the August Consumer Price Index (CPI) up 6.2% on-year, the National Bureau of Statistics (NBS) said Friday (Sep 9).

Price levels surged higher in rural areas of China, up 6.7%, than in urban areas, 5.9% in August. The price of consumer goods also rose faster, at 7.3%, than the price of services, at 3.4%.

The 13.4% on-year rise in the price of food had lifted the overall price level by 4.02 percentage points, of which the 12.2% rise in the price of foodstuff lifted the overall price level by 0.33 percentage points.

The price of pork surged 45.5% and lifted the overall price level by 1.27 percentage points. The price of egg surged 16.3% and lifted the overall price level by 0.14 percentage points. The price of edible oil surged 17.1% and lifted the overall price level by 0.19 percentage points.

The price of food surged 0.6% in August over July, while the price of non-foods 0.2%. In the 6.2% CPI in August, 3.5 percentage points were due to new factors and 2.7 percentage points from lagging effects.