Yuan goes down after recent ‘price controls’ enacted. Natural occurrence or result of market manipulation?
Rebound or response?
China inflation hits 11-year high
As the PRC economy has been so tightly controlled in the past, I’m not certain how historic records are so relevant to the current and future levels.
The ‘man with a thousand names’ will bear the brunt…as always.
The CPI hike is primarily due to food prices, principally pork and grains. Pork prices were up after the government ceased subsidies and then the hog industry was hit by porcine blue ear disease. It’s not recovered as yet. As for grains, China is susceptible to international grain prices. Grains have risen because of increased use of croplands for biofuels. With the US and likely Europe headed for recession, don’t expect any tightening out of Beijing.
I swear these guys are doing a very credible job in turning around the old command economy. 900 of the old thousand names are doing much better than they were before, while the lowest 10% are not seeing much gains, apparently.
It will be interesting of course to see how they deal with a slowdown, which will happen eventually.
last time there was a big inflation… we had mass revolts that lead to the Tienanmen massacre…
Let us hope this time things will be done in a more proper fashion…
From my perspective, they’re stuck in between a rock and a hard place. They want a low value currency to keep their export market alive, but as they’re now having to start importing food, their low currency just means prices rises all around. Can’t go up, can’t go down, up shit creek, without a paddle.