CPI was released in July, how is the price increase? Sichuan led the gains, Beijing saw the smallest gains

  China-Singapore Jingwei Client, August 12th (Zhang Meng) In July, many parts of the country suffered from floods. What is the price increase in various places? Recently, the National Bureau of Statistics released the Consumer Price Index (CPI) for 31 provinces in July.

CPI increase in 18 provinces is lower than that of the whole country

Beijing has the smallest increase

  In July, the national CPI rose by 2.7% year-on-year, and the increase was in the "second era" for three consecutive months. From a month-on-month perspective, the national consumer price rose by 0.6%.

  In terms of provinces, 11 provinces, including Sichuan, Anhui, Yunnan, Jiangxi, Hunan, Hubei, Shanxi, Shandong, Guangxi, Henan, and Chongqing, increased their CPI year-on-year in July more than the national average.

  Among them, Sichuan, Anhui, and Yunnan ranked the top three in CPI growth of 4.1%, 3.9%, and 3.6% respectively. It is worth noting that Sichuan has been at the top of the CPI increase list for three consecutive months.

  Source: National Bureau of Statistics

  In terms of the price index of food, tobacco and alcohol, Sichuan also ranked first with a 15.6% increase.

  In addition, the growth rates of Jiangsu and Guizhou were the same as the whole country. 18 provinces, including Qinghai, Zhejiang, Guangdong, Tibet, Shaanxi, Liaoning, Hebei, Tianjin, Jilin, Fujian, Hainan, Heilongjiang, Gansu, Inner Mongolia, Shanghai, Xinjiang, Ningxia, and Beijing, saw CPI increases lower than the national average.

  Among the 31 provinces, Beijing had the smallest increase in CPI in July, only 0.7%. According to the official website of the Beijing Survey Team of the National Bureau of Statistics, in July, the prices of fresh fruits and eggs in Beijing dropped by 30.1% and 15.0% respectively. Non-food prices fell by 0.3%, which affected the overall index by 0.29 percentage points. Among them, the price of air tickets dropped by 34.8%, an increase of 3.4 percentage points from June; the prices of gasoline and diesel dropped by 16.2% and 17.7% respectively.

  egg. Photo by Zhang Meng, China-Singapore Jingwei

How will egg and pork prices go in the future?

Expert: There will be a downward adjustment later

  In July, pork prices rose by 85.7%, an increase of 4.1 percentage points from the previous month. Dong Lijuan, a senior statistician in the City Department of the National Bureau of Statistics, pointed out that with the gradual recovery of catering services, the demand for pork consumption continued to increase. The relocation has had a certain impact, and the supply is still tight. In addition, due to the reduction in the stock of laying hens, the egg production rate in summer has dropped, and the price of eggs has risen after falling for 9 consecutive months.

  The price trend of pork during the year. Source: Ministry of Agriculture and Rural Affairs

  Ying Xiwen, head of the macro-regional research team of the Minbank Think Tank, told the Sino-Singapore Jingwei Client that it is expected that pork prices will continue to fluctuate in the overall slow decline during the year. Last year, my country’s pork industry’s own cyclical factors superimposed on the severe impact of African swine fever on supply, resulting in the historical peak of pork prices. To this end, a series of policies to restore the supply of pork were introduced in the second half of last year. By the fourth quarter of this year, production capacity will gradually be put into place. The current round of pork rise cycle has begun to enter the second half, and the trend will decline. In addition, from the perspective of demand, the demand for meat will also increase as the autumn and winter seasons and the intensive holidays in the fourth quarter come. Therefore, the gradual recovery of pork prices in the future will take a relatively long time.

  The price trend of eggs during the year. Source: Ministry of Agriculture and Rural Affairs

  In terms of eggs, Ying Xiwen believes that the recent increase in temperature has led to a decline in egg production, and the increase in egg demand during the later Mid-Autumn Festival has promoted the rise of egg prices. It is expected that after entering winter, with the withdrawal of the above factors, the rising trend of egg prices is expected to stabilize.

  In an interview with the Sino-Singapore Jingwei Client, Su Jian, director of the National Economic Research Center of Peking University, pointed out that the prices of pork and eggs will be lowered in the future, and the upward trend will not continue. There are two reasons for the current increase in egg prices. On the one hand, the chicken’s resting period is around July each year, and the production of eggs is low. The increase in egg prices is a seasonal increase; on the other hand, driven by the increase in pork prices, pork substitutes. The prices of eggs, beef, and mutton have risen to varying degrees. Later, as the price of pork drops, the price of eggs will also drop.

Will CPI still show an upward trend in the future?

Expert: Will return to the downward trend

  Li Qilin, chief economist and dean of the research institute of Yuekai Securities, predicted that the CPI will once again enter a downward trend year-on-year. Starting from August, the CPI will be significantly weakened. There is limited room for pork prices to continue to rise. The year-on-year decline of live pigs for slaughter has narrowed, and the stock of pigs has increased month-on-month for three consecutive quarters. The supply of live pigs has improved. After two consecutive months of price increases in June and July, it is unlikely that pork prices will continue to rise sharply. The impact of floods in the south has gradually subsided.

  Based on the analysis of the article, looking forward to the next few months, in the case of a sharp increase in the base last year, it is still a high probability event that the CPI year-on-year growth rate reverted to a decline. The epidemic changes, weather conditions and pork price trends will continue to be the overall downward trend of CPI. Volatility factors.

  The Bank of Communications Financial Research Center pointed out that the current increase in CPI is mainly due to the fluctuation of food prices due to seasonal factors. As seasonal factors weaken in the future, food prices may fall significantly. After August, the impact of the floods on agricultural production and logistics will be weakened, and the prices of vegetables and pork may gradually fall. The CPI will return to a downward trend after a short-term rebound year-on-year, without inflationary pressure. (Zhongxin Jingwei APP)

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