China-Singapore Jingwei client, July 9 (Xiong Siyi) On the 9th, the National Bureau of Statistics will announce the Consumer Price Index (CPI) for June. Domestic institutions generally expect that the year-on-year increase in CPI in June may continue to be in the "2 era".
Institutions forecast an average increase of 2.6%
In May this year, after an interval of 8 months, the national CPI returned to the "2 era", up 2.4% year-on-year. Dong Lijuan, senior statistician of the City Department of the National Bureau of Statistics, pointed out that in May, the domestic epidemic situation was generally stable, the resumption of production and the resumption of operations in an orderly manner, and the market supply and demand situation further improved. Among them, food prices fell by 3.5%, the decline increased by 0.5 percentage points, affecting the CPI fell by about 0.78 percentage points, is the most important factor driving the decline of CPI.
For the upcoming June CPI data, wind data shows that as of July 8, the average forecast of 21 organizations for the year-on-year increase in June CPI was 2.6%. Among them, the maximum predicted value is 2.9% given by Minsheng Securities and Peking University National Economic Research Center, and the predicted value of 13 other institutions is in the range of 2.5%-2.7%.
Xie Yunliang, chief analyst of Minsheng Securities, believes that since June, the price of pork, beef and mutton and fresh vegetables has risen due to the regulatory impact brought by the rebound of the epidemic. In terms of categories, pork prices have increased by about 2% month-on-month, beef, mutton, poultry, eggs and aquatic products have increased or decreased month-on-month, vegetable prices have increased month-on-month, and fruit prices have decreased month-on-month. For non-food items, crude oil prices rebounded slightly from the previous month. Overall, the CPI is expected to rise to 2.9% in June. As the pig cycle enters the second half, the CPI is expected to fall in July 2020.
Analyst Huang Wentao of CITIC Construction Investment and other analysts said that the pork price in June rose slightly from the previous month, but due to the higher base year-on-year, the CPI growth rate of pork in the same month is expected to fall to about 76%. Among other food sub-items, the increase in vegetable prices in June may be the factor with the strongest marginal pull-up effect on food CPI. According to the calculation of high-frequency data, the fresh vegetable CPI in June increased by about 3.4% month-on-month and increased by about 4.8% year-on-year 3. An increase of more than 13 percentage points from the previous month.
Vegetable prices in the rainy season
After entering the rainy season, the news of "increasing vegetable prices" has been heard from time to time in the southern region. According to the Qianjiang Evening News reported on July 6, Mei Yu continued to cause flooding of watermelon and water-leaved vegetables in many places, and the prices of some vegetables in Hangzhou doubled. The report said that in early June, the wholesale price of green vegetables and Mao Maocai was 0.9~1.1 yuan/kg, and now the wholesale price has risen to 2.2~2.3 yuan/kg, the highest peak has risen to 3 yuan/kg.
Not only that, Wuhan and Anqing, which are relatively central, have also said that "the price of vegetables has slightly increased." According to local media reports, Anqing Development and Reform Commission monitoring data showed that in late June, prices of vegetables such as cucumber, cabbage, rapeseed, purple eggplant, and celery rose by 45.49%, 39.57%, 32.61%, 25.44%, and 20.68% respectively from mid-June.
What is the rise in vegetable prices across the country? According to the monitoring data of the Ministry of Agriculture and Rural Affairs, except June 5 to June 11, the average price of 19 kinds of vegetables in 286 wholesale markets nationwide fell slightly by 0.40% from the previous month, and the remaining 4 weeks from May 29 to July 2 19 The average prices of all kinds of vegetables are increasing. Especially from June 19 to June 25, the average price rose by 7.60% month-on-month, the highest weekly increase in the past month.
For the reasons for the recent increase in vegetable prices, CITIC Construction Investment believes that there may be two main logics. First, the domestic epidemic caused the temporary closure of the new market, which increased transaction costs. It is a short-term one-time shock. As the epidemic is controlled and alternative transactions With the introduction of means, transaction costs are expected to reduce to pre-epidemic levels. Second, adverse weather has adversely affected the supply of vegetables. CITIC Construction Investment said that most vegetables have a growth cycle of less than 2 months, so the impact of weather on vegetable prices and CPI is mostly short-term pulses, and there is no obvious sustained impact.
In addition to vegetable prices, pork prices also rebounded. According to data from the Ministry of Agriculture and Rural Affairs, as of 14:00 on June 30, the average pork price in the national agricultural wholesale market was 45.38 yuan, and the data on June 1 was 38.76 yuan. Within a month, the national average pork price rose by 6.62 yuan, an increase of more than 17%.
In this regard, Wang Yanan, an analyst of Zhuo Chuang Information's pig industry, said that the supply of pigs in July is still tight, and the price of pigs may increase slightly. In August-November, the effect of the resumption of pig production by breeding enterprises will gradually appear, the supply of pigs will gradually increase, and the price of pigs may decline. Affected by this, pork prices may rise slightly before declining.
Neither hyperinflation nor deflation will happen this year
Post-epidemic economic inflation or deflation? Li Chao, chief economist of Zheshang Securities, believes that the "pig cycle" has peaked and fell, and the downward trend of CPI is confirmed in the second half of the year. In addition to pork, the prices of fresh vegetables, fresh fruits, staple foods and other foods are less likely to disrupt CPI in the second half of the year. Non-food prices also have no upward momentum. The epidemic also impacted both supply and demand, but overall supply repair was faster than demand. In summary, the annual CPI is expected to be +2.6% year-on-year, of which +1.5% in the second half of the year.
Li Chao also pointed out that the impact of inflation is weakening, and the probability of implementation of the benchmark deposit rate cut will increase. The Central Bank Deputy Governor Liu Guoqiang said in early April when he adjusted the benchmark deposit rate, "it is necessary to consider factors such as price levels, economic growth, internal and external balance, and currency depreciation pressure." The impact is weakening. On June 17, the National Convention proposed to promote the financial system to "reasonably make profits" 1.5 trillion yuan to the real economy. "Concessions" means a decline in the income side of the banking industry. Then the cost side needs policy support such as interest rate cuts and RRR cuts to reflect "reasonable" two word. In summary, the probability of implementation of the benchmark deposit rate cut will increase.
In fact, on July 1, the task force of the Monetary Policy Department of the People's Bank of China published an article in "China Finance" magazine, saying that there is no basis for long-term inflation or deflation in China. The article mentions that under the framework of total supply and total demand, my country has favorable conditions to maintain the price level basically stable. The rate of increase in prices fundamentally depends on the relative changes in total supply and total demand. my country's domestic economy is generally stable, the overall supply and demand are basically balanced, the supply-side structural reforms are further advanced, the role of the market mechanism is better played, the monetary policy remains stable, the monetary conditions are moderately tight, and there is no basis for long-term inflation or deflation. (Sino-Singapore Jingwei app)
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