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MNI:Imports Fuel China Inflation, PBOC To Keep Easing-Advisors

(MNI) London
BEIJING (MNI)

Higher world grain prices will make Chinese pork dearer and feed consumer price inflation, advisors say.

True

More expensive commodities and a weaker yuan could push Chinese consumer price inflation over 3% by next year, but for the moment the negative impact on manufacturers’ profits will only add to reasons for the People’s Bank of China to maintain accommodative monetary policy even if it crimps room for additional easing, advisors and analysts told MNI.

Food prices, including for key index component pork, are set to rise for the rest of this year due to a combination of supply snags caused by restrictions imposed in response to a Covid outbreak and higher global grain prices. More expensive energy will also push up prices for industrial products and eventually feed into CPI, said Zhu Qibing, chief macro analyst at BOC International.

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More expensive commodities and a weaker yuan could push Chinese consumer price inflation over 3% by next year, but for the moment the negative impact on manufacturers’ profits will only add to reasons for the People’s Bank of China to maintain accommodative monetary policy even if it crimps room for additional easing, advisors and analysts told MNI.

Food prices, including for key index component pork, are set to rise for the rest of this year due to a combination of supply snags caused by restrictions imposed in response to a Covid outbreak and higher global grain prices. More expensive energy will also push up prices for industrial products and eventually feed into CPI, said Zhu Qibing, chief macro analyst at BOC International.

Keep reading...Show less