Unlike the world’s major economies, China saw a fall in prices last year, which opens the way for a drop in interest rates to support an activity penalized by the real estate crisis.
In the whole of 2021, the inflation it rose an average of 0.9% (and 1.5% year-on-year in December, compared to 2.3% in November), the National Statistics Office (BNS) reported on Wednesday.
This is a much slower rate than that observed a year earlier (2.4%), as a result of the virtual paralysis of activity in China at the beginning of 2020 after the spread of COVID-19.
On the contrary, in the euro area and in the United States, the inflation runaway is cause for concern.
The president of the United States central bank (Fed), Jerome Powell, said Tuesday that restoring price stability is “at the top of the list of priorities,” justifying in advance a series of interest rate hikes this year in the United States.
Although the specter of inflation has sent tremors through world markets, the trend in China is partly explained by falling food prices.
The decrease is significant in the case of pork (-36.7% in one year), the most consumed by far in the country.
the price of the Pork Meat it had doubled in recent years due to an African swine fever epidemic that decimated farms. But prices fell in 2021 as the disease receded.
The authorities had promoted preventive purchases in early November, calling on the population to stock up on food, in the context of a limited resurgence of the epidemic, accompanied by confinement measures.
stable prices
As for producer prices, inflation also slowed last month, rising just 10.3% year-on-year, down from 12.9% in November. The index of the cost of the goods at the exit of the factory registered in September its biggest increase in more than 25 years (13.5%).
On average, producer prices rose 8.1% in 2021, after falling 1.8% a year earlier.
Producer prices “are likely to continue to slow in the coming months,” said analyst Sheana Yue of Capital Economics.
“But the uptick in the epidemic is likely to cause further disruption to supply chains,” he warned.
Some 20 million people have been quarantined in three cities in recent weeks after the appearance of cases of coronavirus, including the omicron variant.
China has largely recovered from the initial shock of the pandemic, but sporadic outbreaks of Covid-19 across the country continue to disrupt activity.
The recovery has also been weakened by the rise in the prices of raw materials and the crisis in the real estate sector with the collapse of the developer Evergrande, on the verge of bankruptcy.