The consumer price index (CPI) last month increased 2.96 percent from the same period last year, to 102.93, as a result of increases in fruit and fuel prices, the Directorate General of Budget, Accounting and Statistics (DGBAS) said yesterday.
Vegetable prices, which were responsible for inflationary pressure in the fourth quarter of last year, have been on the wane as a result of abundant supply, DGBAS said.
"The CPI increase was the smallest since September last year. Although the CPI increased by more than the 2 percent target, [its growth is slowing]," DGBAS section chief Wu Chao-ming (吳昭明) said.
The CPI increased by 3.33 percent in December, 4.8 percent in November and 5.33 percent in October -- the highest single-month growth in nearly 13 years, DGBAS data showed.
"However, the core CPI, which excludes food and fuel prices, has increased by more than 2 percent for four months, and continues to increase," Wu said. "Usually, the Lunar New Year is the only time when the core CPI increases by more than 2 percent."
The core CPI rose 2.71 percent last month from a year earlier and was up 0.06 percent from the previous month. In December, the core CPI rose 2.57 percent year-on-year and 0.11 percent month-on-month, DGBAS data showed.
China Trust Commercial Bank (
The wholesale price index (WPI) last month surged 10.21 percent to 111.38 on the back of the sky-rocketing prices for imported commodities such as crude oil, chemicals and grains.
The WPI increase was the largest since the 11.85 percent increase in October 2004 caused by a lower base and a spike in commodities prices.
Wu said OPEC's average price per barrel of crude oil was US$88.5 last month, up 74.2 percent year-on-year. He said the 17.2 percent increase in domestic fuel products did not reflect the global trend.
Lin said the heavy snowfall in China was pushing up global commodities prices and would eventually affect local consumer prices.
The import price index soared 16.94 percent year-on-year last month, the biggest increase since November 1990, when crude prices soared as a result of the Gulf War.
Citigroup economists Cheng Cheng-mount (
The WPI growth figure, which has accelerated for four consecutive months, also concerned the economists.
"Climbing WPI inflation adds supply-side cost pressures and poses upside risks to CPI," they said in a client note.
Based on the latest CPI data, Citigroup said it expected the central bank to raise the discount rate by 12.5 basis points in its quarterly policy-making meeting next month.
ADDITIONAL REPORTING BY KEVIN CHEN
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