China inflation rises as price of pork soars, Latest Business News - The New Paper

China inflation rises as price of pork soars

This article is more than 12 months old

BEIJING: China's consumer inflation accelerated at its fastest pace in almost six years last month as African swine fever sent pork prices soaring nearly 70 per cent, official data showed.

The authorities have gone as far as tapping the nation's pork reserve to control prices of the staple meat, as the swine fever crisis could become a political and economic liability for the state.

The Consumer Price Index (CPI) - a key gauge of retail inflation - hit 3 per cent last month, the National Bureau of Statistics (NBS) said, up from 2.8 per cent in August and the highest since November 2013.

Analysts in a Bloomberg news poll had forecast 2.9 per cent.

The rise was caused by food price inflation, particularly disruptions to pork supply, Capital Economics said.

The price of pork soared 69.3 per cent on-year last month, the NBS said.

Beijing's statistics said around one million pigs have been killed since the first outbreak of swine fever in August, but that is considered to be an underestimate.

This in turn has pushed up prices of other meats including beef, chicken and duck and eggs by up to 19 per cent as consumers switched to other sources of protein.

"Looking ahead, consumer price inflation should continue to accelerate in the coming months as supply disruptions continue to push up pork prices and as the drag from lower oil prices eases," said Mr Martin Lynge Rasmussen from Capital Economics.

Producer prices, however, continued to slide for the fifth straight month, hit by weakening demand and mounting trade tensions with the US. - AFP