China-Singapore Jingwei Client, December 9th (Dai Congfei and Zhang Meng) On the 9th, the National Bureau of Statistics will announce the Consumer Price Index (CPI) for November.
Many institutions predict that the CPI will continue to fall in November, dropping to near "0".
Agency forecast average increase of 0.05%
The CPI continued its decline in October to 0.5%.
Dong Lijuan, a senior statistician at the City Department of the National Bureau of Statistics, analyzed at the time that in October, food prices rose by 2.2%, a decline of 5.7 percentage points, affecting the CPI increase by about 0.49 percentage points.
In food, pork prices fell for the first time after 19 consecutive months of rising, down 2.8% year-on-year.
For the upcoming CPI data for November, Wind data shows that as of December 8, 12 institutions have predicted an average of 0.05% for the CPI year-on-year increase in November.
Among them, the maximum predicted value is 0.3% given by China Merchants Securities, and the minimum is -0.2% given by CICC.
In October, pork prices fell for the first time after rising for 19 consecutive months, down 2.8%.
In November, pork prices continued their downward trend, with an average wholesale price of 39.43 yuan/kg.
Haitong Securities pointed out that since November, pork prices have fallen significantly, vegetable prices have fallen, and fruit prices have remained relatively stable.
Pig prices are expected to continue to decline as supply pressures ease, and the CPI is expected to continue to fall to zero in November compared with the same period last year.
Green onion and ginger prices are difficult to stop CPI decline
According to the website of the Ministry of Agriculture and Rural Affairs, in November, the wholesale prices of green onions and ginger were 4.56 yuan and 14.08 yuan per kilogram, respectively, up 100.88% and 58.56% from May.
Source: Screenshot of the official website of the Ministry of Agriculture and Rural Affairs
Why did the price of green onion and ginger rise sharply?
Zhang Jing, an associate researcher at the Institute of Agricultural Information, Chinese Academy of Agricultural Sciences, believes that the main reason is on the supply side.
On the one hand, the reduction in comparative benefits has led to a significant drop in the planting area of onions and ginger; on the other hand, excessive rainfall has led to a decline in the yield of green onions and ginger.
As for whether the price increase of green onions will put pressure on prices, Fu Yifu, director of the Consumer Finance Research Center of the Suning Institute of Financial Research, said that the CPI is not a single commodity price increase, but an overall indicator.
For green onions, although the recent price increase has been very strong, its proportion in the CPI is very limited, and it will hardly have much impact on the overall CPI index.
How do prices go in the future?
Regarding future price trends, Haitong Securities pointed out that with the economic recovery, industrial prices will tend to rise, and PPI is expected to continue to rise in the future.
The PPI is highly correlated with the trend of core prices, and its rebound will push non-food CPI prices to rise simultaneously.
Therefore, even if pig prices continue to fall next year, leading to a fall in food CPI prices, inflation risks may still rise again.
Zheshang Securities believes that the deterministic rebound in the supply of live pigs will push the price of pigs down, and cheap pork will drive the CPI down. It is expected that the CPI will be near zero in the first quarter of 2021.
However, as the factors affecting pork prices weaken, starting from the second quarter, the pork base effect has weakened, and the CPI tail-lifting factor has turned from negative to positive.
(Zhongxin Jingwei APP)
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