Will China’s Inflation Rates Continue to Rise?
China’s inflation rate soared to a seven-month high, sparking fears over whether the rate is fully under control, Reuters reports.
The annual consumer inflation rate rose to 3.1 percent in September, up from 2.6 percent in August, rising by nearly twice the amount that most analysts had expected. On a month-by-month basis, the increase represents a rise in consumer prices of 0.8 percent from August to September.
Leading the way in the inflation upsurge were food prices, which rose 1.5 percentage points between August and September. Chinese officials have claimed that floods and droughts harassed food production, especially in the south of China, translating into an increase in prices. Reuters said an additional factor may have been the Mid-Autumn Festival occurring earlier than usual this year, which could have boosted demand for food during the month.
Many economists expect inflation rates to rise through the rest of this year and into early 2014, citing the looser monetary policy of the Chinese government as one catalyst for the prediction. Beijing has set 3.5 percent as an official goal for inflation rates, meaning that there is a ways to rise before rates are at levels that would concern the Chinese government.