The State Council Systematically Deploys &Nbsp, And Controls The Overall Upgrading Of Prices.

Yesterday (April 13th), Premier Wen Jiabao chaired a State Council executive meeting. The conference analyzed the first quarter. economic situation And deploy the economic work in the next few months from 7 aspects. Among them, currency Problems and stability price And real estate regulation is the top priority.

Since 2011, inflation in China has not been alleviated, and the outside world has predicted that CPI will exceed 5% in March. On the premise of ensuring economic growth, the State Council, in deploying the economic work for the next few months, especially emphasizes stabilizing prices, and resisting inflation will still become the main economic line of the two quarter.
Warning inflation risk

During the analysis of the economic situation in the first quarter, the meeting pointed out that since the beginning of this year, China's economy has been running smoothly and the national economy has started well.

A person close to the macro-control department believes that the current economic growth situation in the first quarter is still optimistic, and the specific increase will be higher than 9%. From the three major needs, fixed asset investment continued to show a positive pulling effect, and external demand growth was also more stable.

The conference also warned that from the international point of view, the economy of the major economies resumed growth, but the prices of commodities such as grain and oil continued to rise, and inflation pressure was expanding from emerging economies to developed economies. The world economy has not yet embarked on the track of normal growth, and now there are new variables.

Although there are many favorable conditions for the development of the domestic sector, there are also many challenges. The main reason is that prices are rising faster, inflation expectations are increasing, the volume of real estate market is shrinking, the housing prices in most cities are still rising, and macroeconomic regulation is facing greater pressure.

Zhu Baoliang, chief economist of the Forecast Department of the state information center, told the daily economic news reporter that China's inflationary pressure is mainly imported. International commodity prices such as grain and oil have greatly affected the price trend in China.

Do everything possible to stabilize prices

Of the 7 deployments of the next phase of the State Council, 3 are directly related to stabilizing prices and fighting inflation. The meeting called for every effort to keep the general price level basically stable and to control price rises within the limits that can be affordably maintained.

The first is to implement a sound monetary policy. It is necessary to deal with the relationship between controlling the total amount of money and improving the structure, restraining inflation and promoting economic growth.

The second article clearly points out that the next stage should "do everything possible to keep the general price level basically stable", and stressed that "this is the primary task and the most urgent task of this year's macroeconomic regulation and control".

The meeting called for the full implementation of the State Council's overall plan for stabilizing the general price level. We must take various measures to comprehensively cope with the pressure of rising prices at home and abroad from controlling money, developing production, ensuring supply, invigorating circulation and strengthening supervision.

The production and supply of agricultural products are listed in fourth articles. The meeting pointed out that we should do a good job of agriculture and grain production without delay. We should continue to implement the responsibility system of "rice bag" governor and the mayor responsibility system of "vegetable basket", and do a good job in the construction of circulation system of agricultural products.

Shen Jianguang, chief economist of Mizuho Securities, believes that the upward trend of inflation may continue in the two quarter. Inflationary inflection points appear in the second half of the year, but the effectiveness of the central bank's tightening policy will be the key to the trend in the second half.

The two quarter interest rate increase is a big probability event.

Faced with the urgent inflation situation, the NDRC talked about the price rise of consumer goods represented by daily chemical and liquor industries at the beginning of this month. Many analysts believe that except for administrative means, the central bank is likely to use interest rate as an effective tool to block inflation. The two quarter interest rate increase is a big probability event.

Judging from the contents of the executive meeting, the decision level also recognizes this view.

In the next few months, in the implementation of a sound monetary policy, the meeting pointed out that the comprehensive use of open market operations, deposit reserve ratio, interest rates and other price and quantity tools to further improve the RMB exchange rate formation mechanism, and control the scale of social financing within the reasonable range. It not only eliminates the monetary factors of inflation, but also meets the financial needs of the real economy.

CICC believes that "in the coming months, the central bank will raise the benchmark interest rate significantly, and accelerate the appreciation of the exchange rate to cope with imported inflation."

The company's latest report pointed out that the government has adjusted the CPI target center to 4% in the next 5 years, reflecting that the long-term target of fixed interest rate for 1 years should be around 4%, so as to eliminate the negative interest rate completely.

Li Xunlei, chief economist of Guotai Junan, told reporters that in the context of inflation in 3~7 months, the central bank's interest rate increase "boots" are likely to fall in May or June.

"In order to curb inflation, we need to raise interest rates at least once in the first half of the year, because inflation pressure is relatively moderate in the second half of the year, and interest rate hikes may have an impact on economic growth." Zhu Baoliang said.