China’s January inflation jumps 2.5 per cent in January; beats Analysts Expectations
China's consumer inflation in January hit the highest level since May 2014 on back of soaring food prices, official data showed on Tuesday. The latest inflation figures may raise some concerns as the second largest economy desperately looks to recover from a long drawn economic recession.
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China's consumer price index increased 2.5 per cent in January from a year earlier, the National Bureau of Statistics said. This is higher than 2.1 percent rise witnessed in the previous month of December.
The National Bureau of Statistics blamed January's inflation spike on rising food prices ahead of the Lunar New Year holidays. Most analysts expected January inflation to remain tad lower. Reuters and Wall Street Analysts poll predicted the inflation to remain at 2.4 percent.
Meanwhile, the China's producer price index (PPI) increased 6.9 percent in January, compared to 5.5 percent increase recorded in the month of December. The January's PPI level is the highest since the August 2011.
The latest surge in inflation figures may prompt the talks of tighter monetary policy in the market, but many analysts believe that China's inflation levels are still within the comfort zone of the central bank. The Chinese economy has been passing through its most challenging phase for over one and half years, with most economic indicators depicting a very grim picture of the economy.
However, recently there has been some good news on the front of manufacturing sector and real estate sector, brining a much needed cheer for the economy. Also, the Chinese market continues to remain sceptical as it expects some hawkish trade policies to be announced against China by the new Donald Trump administration.