Inflation eases, but prices for services see big increase
Print Edition
China reported milder inflation for February, with inflation at its lowest since January 2018, leaving ample room for authorities to adjust macroeconomic-control policies.
The Consumer Price Index rose 1.5 percent year on year in February, compared with 1.7 percent growth in January, data from the National Bureau of Statistics released on Saturday showed.
“The lower year-on-year CPI was largely due to a high comparison base in February last year, when CPI stood at 2.9 percent,” said Deng Haiqing, chief economist at JZ Securities, adding that February’s CPI is likely to be the lowest monthly reading this year.
Saturday’s data also shows Chinese consumers are upgrading their consumption habits as the CPI in service sectors such as education, entertainment and health care all rose over 2 percent year on year, said Xu Guoxiang, a professor at Shanghai University of Finance and Economics.
On a month-on-month basis, the CPI last month rose 1 percent from January and saw expansion for three months in a row, which exceeded market expectations.
Due to strong demand during the Spring Festival holiday as well as rainy and snowy weather in some parts of the country, the prices of fresh vegetables, fruits and aquatic products saw significant growth last month, jumping 15.7 percent, 5.4 percent and 4 percent, respectively, from January. They contributed 0.58 percentage points to the month-on-month CPI growth.
Pork, mutton and beef prices also gained, rising 0.3 percent, 1.6 percent and 0.6 percent, respectively, from one month earlier, while egg prices decreased 5.3 percent month on month due to abundant supply.
Travel demand during the Spring Festival and the winter vacation also pushed the prices of tour agency services, plane tickets, hotel accommodation and movie tickets higher, according to the NBS.
Gasoline and diesel prices rose 3.6 percent and 3.9 percent, respectively, month on month, and costs for vehicle repair and maintenance jumped 5.1 percent.
Analysts said the CPI is expected to rebound to above 2 percent in March year on year, due to a relatively high figure last year.
China aims to keep CPI around 3 percent in 2019.
The Producer Price Index, which measures costs of goods at the factory gate, edged up 0.1 percent year on year in February, unchanged from January.
“The PPI reflects that China’s pro-growth measures have taken effect, and the confidence of enterprises is recovering,” said Zhang Liqun, a researcher with the Development Research Center of the State Council, China’s Cabinet.
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