In October, consumer prices rose 4.4% year-on-year, hitting a 25-month high

In October, the China National Bureau of Statistics released the Consumer Price Index (CPI), showing that the CPI for the month rose 4.4 percent year-on-year, marking the highest increase for 25 months.

In October, food prices rose 11.1 percent year-on-year, an increase of 1.4 percentage points over the previous month. Pork prices in particular increased by an eye-popping 115.6 percent year-on-year. At the same time, prices of non-food items grew by 1.5 percent compared to the same period last year, with housing prices rising by 3.2 percent in October.

The CPI increase in October was mainly driven by rising food prices. At a time when food prices are particularly sensitive, surging pork and vegetable prices have caused a substantial increase in the CPI. Experts have attributed this to the outbreak of African swine fever and unfavorable weather in major vegetable production areas.

However, CPI growth in October remained well within the government’s 3 percent inflation target. This means that while prices are going up, they are doing so in a orderly manner, and Chinese citizens are still benefiting from the healthy economic growth.

Meanwhile, the government is taking measures to ease inflationary pressure in the consumer market. For instance, it has encouraged companies to pass on lower production costs to consumers, monitored food prices more closely, and implemented a series of tax cuts and subsidy programs to help businesses cope with rising costs.

In addition, the government has been encouraging domestic consumption in order to increase consumer purchasing power. This includes the expansion of consumer finance, the easing of restrictions on commercial real estate transactions, and the launch of targeted measures to support rural consumption.

Looking ahead, the government is expected to continue to take measures to keep the economy growing and the inflation rate under control. Although inflationary pressure may remain high in the short term, the economy is likely to remain healthy as long as the government is able to manage it effectively.

In October 2020, the consumer prices of Chinese residents increased significantly by 4.4% compared to the same period of last year, reaching a new high for 25 months.

The significant growth in resident consumption was mainly driven by higher prices in food and non-food services. The prices of food such as pork, fresh vegetables, and fresh fruits all increased as a result of the impact of African swine fever, rising labor costs and shortage of supply due to the COVID-19 pandemic, etc.

At the same time, prices of daily commodity services such as transport and recreation, travel and entertainment, housekeeping and catering were also on the rise, largely due to the increase in service prices in this area which was the result of strong demand after the epidemic, as well as the increase in labor costs.

Statistics from the National Bureau of Statistics of China show that in October 2020, the consumer price index of Chinese residents has hit a record high in 25 months, all of which has been the primary factor which contributed to the growth of the consumer price index.

Generally speaking, cautious consumption with restrained supply and demand was the main driver behind this new high. With the backing of a series of measures to enhance consumption in China, it can be expected that the growth of consumer prices will be relatively stable in the future.

At the same time, with the implementation of the consumer stimulus policies, the demand for consumer goods and services are expected to continue to increase, causing consumer prices to remain relatively high in the coming months.

The consumer price index of residents is an important macroeconomic indicator, and a stable increase in consumer prices reflects the balanced development of Chinas economy and the improvement of Chinese people’s living standards.