Counting the cost as inflation strikes nation

08:42, November 30, 2010      

Email | Print | Subscribe | Comments | Forum 

A vendor sits in front of a pile of vegetables as he waits for customers at the Xinfadi open-air wholesale market in Beijing on Nov 23. Traders are also feeling the pressure. Reuters

Wang Qilu looked out from his street-side fruit and vegetable stall and sighed.

"Business is getting worse," he said, his eyes downcast. "Prices keep going up and fewer people are buying."

After 15 years of menial jobs, including work as a street cleaner and coal miner, the stall had provided the 41-year-old with a safe and steady income. Until he began to feel the force of inflation, that is.

According to the National Bureau of Statistics, food prices in October rose 10.1 percent year-on-year, the highest rate in two years. Vegetable prices alone climbed 18 percent.

The result has led to a massive 4.4-percent growth for China's consumer price index, a key indicator of inflation.

"Take the retail price of long beans," said Wang in Taiyuan, capital of Shanxi province. "To buy 1 jin (a Chinese measurement equal to 500 grams) has almost doubled from 2 yuan to 3.5 yuan in the last month."

The father of two is used to taking home roughly 3,000 yuan ($450) a month but explained things are getting so tight he could be forced to delay buying his younger daughter a new winter coat.

Under the pressure of high inflation, the State Council last week announced a package of measures to prevent further price hikes, including increasing supplies of vegetables and daily necessities, as well as offering subsidies to low-income families.

On Nov 19, China's central bank also raised the reserve requirement ratio (the amount commercial banks must hold in customer deposits) by 50 basis points for the second time in nine days.

"The recent moves by the Chinese government indicate the nation has realized the importance and necessity of normalizing monetary policy and suppressing high inflation," said Wang Tao, head of China economic research at UBS Securities, a global financial services firm.

By Ding Qingfen, China Daily
【1】 【2】 【3】 【4】


  • Do you have anything to say?


Special Coverage
  • Premier Wen Jiabao visits Hungary, Britain, Germany
  • From drought to floods
Major headlines
Editor's Pick
  • Chinese Navy soldiers hold an evening party marking the upcoming 62nd National Day aboard Chinese Navy hospital ship "Peace Ark" in the Pacific on Sept. 28, 2011. The Chinese National Day falls on Oct. 1. (Xinhua/Zha Chunming)
  • Photo taken on Sept. 30, 2011 shows the crowd at the plaza of Beijing Railway Station in Beijing, capital of China. The railway transportation witnessed a travel peak with the approach of the seven-day National Day holidays on Friday. (Xinhua)
  • A man wearing high-heel shoes takes part in the 3rd annual Walk a Mile in Her Shoes, an event when men literally walk in women's shoes to raise awareness about ending violence against women, at Yonge-Dundas Square in Toronto, Canada, Sept. 29, 2011. (Xinhua/Zou Zheng)
  • Photo taken on Sept. 29, 2011 shows a cargo ship in danger on the sea near Zhuhai City, south China's Guangdong Province. Cargo ship Fangzhou 6 of Qingzhou of southwest China's Guangxi Zhuang Autonomous Region lost control after water stormed into its cabin due to Typhoon Nesat on the sea near Zhuhai Thursday, leaving 12 crew members in danger. Rescuers rushed to the ship and saved them by using a helicopter. (Xinhua)
  • Actress Gong Li poses for L'Officiel Magazine. (Xinhua Photo)
  • Demonstrators from the Occupy Wall Street campaign hold placards as they march in the financial district of New York September 29, 2011. After hundreds of protesters were denied access to some areas outside the New York Stock Exchange on September 17, demonstrators set up a rag-tag camp three blocks away. Zuccotti Park is a campground festooned with placards and anti-Wall Street slogans. The group is adding complaints of excessive police force against protesters and police treatment of ethnic minorities and Muslims to its grievances list, which includes bank bailouts, foreclosures and high unemployment. (Xinhua/Reuters Photo)
Hot Forum Discussion