Central Bank: PPI is expected to decline in the fourth quarter of this year and next year

　　Chinanews.com, July 13th. Sun Guofeng, Director of the Monetary Policy Department of the Central Bank, pointed out on the 13th that my country’s PPI rise is phased and may remain relatively high in the second and third quarters of this year. As the base effect gradually fades and global supply resumes, it will bring input. The impact of sex has weakened, and PPI is expected to decline in the fourth quarter of this year and next year.

Data map: Production scene in a manufacturing company.

Photo by China News Agency reporter Yang Bo

　　The State Council Information Office held a press conference on the 13th to introduce financial statistics for the first half of 2021.

At the meeting, a reporter asked: The year-on-year increase of PPI in June dropped by 0.2 percentage points from May to 8.8%, but it is still running at a high level. How does the central bank judge the next trend of PPI and whether it thinks this decline is a trend? Based on the overall RRR cut, is there any need for further RRR cuts or even interest rate cuts in the future?

　　Sun Guofeng said that in recent times, my country's PPI has risen rapidly. This is due to the low base factor of the negative growth of PPI caused by the impact of the epidemic in the same period last year, and the import impact of rising international commodity prices.

　　He said that the phased upward trend of PPI during the year should be viewed objectively.

On the one hand, this is a high reading based on last year's low base. In this regard, we can use the overall perspective of last year, this year and next year to observe the changes in PPI.

On the other hand, historically, the PPI indicator itself has relatively large fluctuations, and it is not uncommon to see the phenomenon of falling or rising in stages within a few months.

　　Sun Guofeng pointed out that in general, the rise of my country’s PPI is phased and may remain relatively high in the second and third quarters of this year. As the base effect gradually fades and the input impact brought by the recovery of global supply weakens, the PPI is expected to be in the fourth quarter of this year and next year. Tends to fall back.

　　Regarding the RRR cut, Sun Guofeng responded that the RRR cut is a routine liquidity operation after the monetary policy returns to normal, and the orientation of prudent monetary policy has not changed.