China: Inflation accelerates in April on higher prices for fresh vegetables
May 9, 2013
In April, consumer prices increased 2.4% over the same month last year. The reading was above the 2.1% rise observed in March and overshot market expectations that had prices rising 2.3%. According to the statistical office, inflation accelerated on the back of higher prices for food, in particular for fresh vegetables, as well as for clothing.
On 25 April, the National Development and Reform Commission cut the benchmark retail price for gasoline and diesel prices by about CNY 0.29 per litre and CNY 0.34 per litre respectively. This is the first price adjustment after the country overhauled its fuel price system on 26 March.
Meanwhile, in April, the producer price index fell 2.6% over the same month last year. The print was below the 1.9% drop seen in March and exceeded the 2.3% decline expected by market analysts. As a result of the monthly decrease, the annual average variation of the producer price index fell further from minus 2.2% in March to minus 2.3% in April.
Despite the annual increase, inflation continued its downward trend, with annual average inflation falling from March's 2.3% to 2.2%. The government expects that inflation will average 3.5% this year. FocusEconomics Consensus Forecast participants anticipate inflation to average 3.3% in 2013, which is unchanged from last month's estimate. In 2014, the panel sees inflation rising to 3.7%.