Debate heats up on rising inflation pressure

BEIJING, May 12: Inflation pressure to increase interest rate debate warming reporter Wang, the Yiu Junfang National Bureau of Statistics earlier released the Consumer Price index (CPI) Rose 2.8%, creating a 18-month high, distance of 3% of the price control target and international cordon only one step away,　　The debate over raising interest rates has been heating up. At the moment, inflationary pressures have become an indisputable fact. Last year's new $9.6 trillion bank credit, and more than a 30%-month-old money supply, have provided strong financial support for the recovery, but also put pressure on future price increases and reinforce public inflation expectations.　　A survey of the People's Bank of China's recent surveys of urban savers showed that the "price expectation index" continued to rise since the first quarter of 2009. "We expect CPI and PPI to continue to rebound in the coming period," he said. Under the influence of weather, transportation, labor cost and speculation of hot money, the impact of the price of vegetables, grains, pork and other agricultural products, plus the positive and trailing effect of the peak, may push CPI to continue to rise, and reached the year high in 6 July.　　"said Xun Peng, a researcher at the Bank of Communications Finance Research Center. The risk of inflation has aroused the concern of our monetary authorities. Compared to previous routine reports, the central bank has devoted more space to the issue in its first quarterly report on monetary policy implementation. The report believes that the current external demand is still recovering, domestic industrial production capacity is more abundant, conducive to stabilizing prices.　　However, in the context of looser global monetary conditions and overall economic recovery, the upward pressure on our prices is also increasing.　　In the case of increased inflationary pressure, the market for interest rate expectations gradually strong, in the National Bureau of Statistics released CPI data on the day our stock market opened a low, prev close down nearly 2%, and the recent stock market is a continuous negative to create a new low, showing the market for possible interest rate concerns and panic. The market worries are justified. For now, the CPI, which is close to the international cordon of 3%, has been standing on a 2.25%-year deposit rate for 3 consecutive months, meaning that the residents ' real deposit rate has been negative for one year.　　In this context, institutional analysts say the two-quarter rate hike has been a big probability event.　　But some economists argue that, despite the better-than-expected price rises of April, inflationary pressures have increased, but that does not mean higher interest rate increases, depending on macroeconomic growth and monetary policy in the world's leading economies. "We note the sharp rise in factory prices in April, which means that production and operating costs are increasing rapidly, and if the interest rate hike increases, the financing costs of the companies will be increased and the further improvement in business will be a blow." Interest rate hikes are not the first choice for central bank monetary instruments, given the international capital flows.　　"Guo, director of the Cufe Banking Research Center, said. Data from the National Bureau of Statistics show that April PPI Rose 0.9% year-on-year, up 1% Quarter-on-quarter, Market ForecastFuture PPI will also show continued increase in the trend.　　Experts believe that now that the European sovereign debt crisis is spreading, the U.S. economic growth is not enough power to rule out the world economy "two dip" risk, and in view of the investment slowdown and other reasons, China's economic growth in the next few quarters will be a quarterly decline, the central bank will be cautious to use interest rate tool. "The need for the central bank to raise interest rates has recently decreased, and monetary policy practices will continue to be dominated by open market operations, increased legal reserve requirements and Credit window guidance."　　Said Yongjian, a researcher at the Bank of Communications Finance Research Center.　　Since this year, the central bank has raised the deposit reserve ratio three times in a row, after the Spring Festival has been 12 consecutive weeks in the open market to achieve a net withdrawal of funds, through these quantitative monetary policy, the continuous recovery of market liquidity. The central bank's first-quarter monetary policy implementation report, in the future, pointed out that we should use a variety of monetary policy tools to strengthen liquidity management in the future.　　We will continue to implement moderately loose monetary policy, grasp the dynamics, rhythm and focus of policy implementation, maintain continuity and stability of policy, and enhance pertinence and flexibility.　　In fact, in the aspect of improving pertinence, the interest rate control of real estate credit and local financing platform has achieved the goal of restraining asset bubbles, regulating inflation expectation and avoiding the big damage of the real economy. Guotai chief economist Li Thunderbolt, the current "first set of housing loan interest rate cancellation 70 percent discount" "two sets of mortgage rates from the allowed to float up to 10%" and other policies, the buyers of the "interest rate effect" is much higher than the normal rate hike a 25 basis point level, the expected effect is showing.