CPI Rose To A 15 Month Low In December.

The latest figures released by the National Bureau of statistics on 12 showed that the consumer price index (CPI), representing inflation, rose by 4.1% in December last year (compared with the same period last year), falling for fifth consecutive months and hitting a 15 month low.

This shows that the current inflation situation, as expected by all parties, has further declined.

However, data from the National Bureau of statistics also showed that food prices rose in December last year due to holidays such as new year's day, leading to an increase of 0.3% in the CPI annulus (last month), ending the trend of a decline in the first two months.

It also directly led to a 4.1% increase in December last year, which exceeded the previous market expectations.

This has led many market participants to believe that it is unlikely that the macro control policy will be relaxed in the near future.

According to the National Bureau of statistics, CPI increased by 5.4% in 2011, higher than the target set at the beginning of the year, not exceeding 4%.

Holiday factors cause CPI to be higher than market expectations.

According to statistics released by the National Bureau of Statistics yesterday, CPI rose 4.1% in December 2011.

This figure is slightly higher than market expectations.

Analysts believe that the final data is higher.

From the link data, it is more obvious that food prices rose 1.2% in December last year.

According to the data, the price of fresh vegetables has risen sharply in the published food items.

The price of fresh vegetables and aquatic products rose by 13.9% and 0.9% respectively (compared with 6% and 0.7% respectively in November), while the total price of two items increased by 0.36 percentage points.

In addition, the price of fresh fruit rose 2.7% over the month of November.

This year CPI "bottom slow return".

However, academics are generally "not very interested" in food prices.

Bank of Communications

Societe Generale Bank chief economist Lu commissar also said that the price trend of meat and poultry and its products is the key to determining the trend of food. The recent upward trend of pork prices is significantly weaker than the same period in previous years. The increase in pig stocks means that the downward pressure on food prices will be greater next year.

From the data, the main trend of pork prices which has caused CPI rise in recent months is still relatively mild.

The price of meat and poultry and its products and eggs decreased by 0.8% and 1.7% respectively, and the two combined prices affected the overall price level by about 0.07 percentage points, while the oil price fell by 0.2%.

Last December, pork prices fell by 2%, down 3.3 percentage points from the decline in November.

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Looking at the views of many experts, most scholars believe that as long as this year January (Note: January 23rd this year as the Spring Festival), I believe that with the decline in food prices, this year's CPI price decline will be the general trend.

Another corroboration is that the latest data released by the Bureau of Statistics yesterday also showed that the producer price index (PPI) of industrial producers in December dropped further, up 1.7% from a year earlier, reaching a 24 month low of 0.3%.

Generally speaking, PPI has an antecedent index for CPI.

Lu commissar yesterday predicted that CPI will slow down this year.

In January, CPI may rebound slightly to 4.3% near the impact of the Spring Festival, but the possibility of over 4.5% is very small. In February, it will continue to fall, which is likely to fall below 4%.

This year, the CPI may be between 2.5%-3.0%, showing a trend of "bottom slow return" in the month. The possibility of a low point in 7-10 months is relatively large. The absolute level of low point may fall below 2%, but the possibility of dropping below 1% is unlikely.

Policy easing is expected to appear in the two quarter.

Since CPI is going to decline after January, what does it mean for the macro control policy? Most analysts believe that this means that short-term monetary policy does not have the conditions to relax substantially.

"While the policy will continue to focus on maintaining entity growth in the short term and maintaining a relatively relaxed policy stance, it will be more cautious in terms of easing efforts than before," he said.

Goldman Sachs Gao Hua, a Chinese macro economist, said Song Yu.

Bank of communications financial research center also believes that monetary policy in 2012 generally relaxed compared with 2011, and showed three characteristics: flexible balance, forward-looking grasp and targeted measures.

"There is little possibility of a cut in interest rates, and the benchmark lending rate for 2012 is expected to remain basically stable.

However, the possibility of serious external shocks and a slight reduction of interest rates by 1 or 0.25 percentage points is not ruled out. "

The Bank of communications should be more optimistic about the deposit reserve ratio policy.

The bank expects the central bank to reduce the deposit reserve ratio by 2 to 4 times this year.

In general, most experts believe that monetary policy will not change significantly as short-term inflation remains at a high level of around 4%.

In particular, the interest rate policy will almost certainly not be loosened. If foreign exchange continues to drain and other factors, the central bank may respond to the deposit reserve ratio on several occasions.

But if we look at the long term, experts' views should be much more relaxed.

Most experts believe that if the external situation continues to be uncertain, if the CPI falls below 3% in the middle of this year, there may be a chance to cut interest rates.

Li Yang, vice president of the Chinese Academy of Social Sciences, said in a forum held yesterday that in the two quarter of this year, in the two quarter of this year, under the circumstance of slowing down the pressure of rising prices, "ensuring growth" is probably a more important goal.

Li Yang said that the current international environment has directly affected China's economic growth through trade channels. The trend of the decline in China's economic growth rate should be quite obvious. Some data projections show that China's economy is going downwards.

Therefore, with the pressure of rising prices slowing down, between the two major policies of "maintaining growth" and "controlling prices", it seems that "keeping growth" has shifted to "controlling prices".

Li Yang believes that this trend may be more prominent in the second quarter.