China inflation to dip below 5pc by year-end

BEIJING : China 's annual monthly inflation is on track to fall below 5 percent before the end of 2011 as the rise of f

Published November 14, 2011 Updated November 14, 2011 04:26am

2 min

By Shoaib Ur Rehman

Add BRecorder as a trusted
source on Google

A break in imported price rises due to slackening world economic growth is also helping cool China's inflation, according to a report by the price monitoring centre of the National Development and Reform Commission (NDRC).

Full-year annual inflation in China is likely to be around 5.5 percent in 2011, the centre said. The government aims to keep annual inflation in 2011 at 4 percent.

China's annual inflation dipped to 5.5 percent in October from September's 6.1 percent, pulling back further from July's three-year peak, giving Beijing more room to fine-tune policy to cushion the impact from a global slowdown.

The government will be able to keep inflation below 4 percent in 2012, the planning agency was quoted as saying. It cited favourable factors such as rising grain and pork output.

But "inflationary pressures will still be relatively big" and fighting inflation should remain the top priority for the government, which should have greater tolerance about a slowdown in economic growth and higher inflation, it said.

The government has been boosting credit to cash-starved sectors of the economy in "selective" policy easing. But analysts don't expect an interest rate cut any time soon.

Read Comments