NBS Blames Previous Month's High Base for Fall of Annual CPI Growth in December
Yicai Global
/SOURCE : Yicai
NBS Blames Previous Month's High Base for Fall of Annual CPI Growth in December

(Yicai Global) Jan. 10 -- The latest data shows the yearly growth rate of China's consumer price index (CPI) fell from the previous month in December 2016. Officials pointed to the relatively high base of the previous month as the main cause.

China's National Bureau of Statistics (NBS) said today that consumer prices rose 2.1 percent in December 2016, down from the previous month's 2.3 percent growth. Sheng Guoqing, senior statistician from NBC's urban division, said that this was mainly due to the relatively high base of comparison. Specifically, the price of fresh vegetables dropped to 2.6 percent -- down from the previous month's 15.8 percent -- a decrease of 0.30 CPI percentage points, and was the major factor behind the slowed annual CPI growth.

China's CPI rose 0.2 percent monthly in December, and annual CPI rose 2.0 percent, with the growth rate 0.6 percentage points higher than 2015.

The NBS data also indicates a 1.6 percent monthly rise in the national producer price index (PPI) in December, with the growth rate 0.1 percentage points higher than the month before. Sheng ticked off the reasons for this faster monthly PPI growth. First, exchange rate fluctuations and other causes sent imported commodity prices up, lifting in turn the ex-factory prices of various industrial products. Second, industrial production and market demand kept growing stably, while de-capacity and de-stocking policies also showed a clear effect, thereby improving the supply-demand relationship, he said.

In December, China's PPI climbed 5.5 annual percent -- an increase of 3.3 percent from the previous month -- while the annual PPI dropped 1.4 percent, with the rate of decline narrowing to 3.8 percentage points from 2015.

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