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China's Price Index to Pick Up
Analysis from the Price Department of State Development Planning Commission shows that China's price level in the second half of this year will mainly show a rising tendency. The consumer price index this year is expected to turn from negative to positive with the increase of about 1 percent. But the possibility of a re-emergence of fluctuation cannot be ruled out.
According to the analysis, with the government's policy of expanding domestic demand and western development further implemented, the investment capability and anticipated investment amount of industrial enterprises will gradually increase, the demand for investment in the second half of this year is expected to maintain a rapid growth; because of the favorable turn of the entire economic situation of the country and stable increase in the income of staff and workers, there has been clue of new consumption hot spots and citizens' consumption will maintain a growing tendency; a further adjustment of the over-low prices of some basic products and services by the government will directly promote the increase of consumer price index; with the quickening connection of domestic and international market prices, the pickup of the prices of staple products in the international market will also alleviate the pressure brought about by the continued price fall of some commodities in the domestic market.
The analysis also indicated that despite the positive change in the general level of price in the first half of the year, the tendency of spontaneous price rise has not taken shape, the foundation for a rise in the general price level is not firm enough. Therefore, the pickup momentum in the latter half of this year will not be very strong.
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