Source of this article: Times Finance Author: Alimire
After the Spring Festival, the inertia of consumer demand fell.
According to data released by the National Bureau of Statistics on April 10, in March, affected by factors such as the seasonal decline in consumer demand after the holiday and the overall sufficient market supply, the CPI (National Consumer Price Index) fell seasonally month-on-month, and the year-on-year increase declined.
Specifically, the CPI fell by 1.0% month-on-month. On a year-on-year basis, the CPI rose 0.1%, down 0.6 percentage points from the previous month. The month-on-month decline and the year-on-year increase were both affected by the decline in food and mobility service prices. From January to March, on average, the CPI was unchanged from the same period last year.
In food, the post-holiday consumer demand fell, coupled with the temperature in most areas higher than the same period of the year, the market supply was generally sufficient, and the prices of fresh vegetables, pork, eggs, fresh fruits and aquatic products fell by 11.0%, 6.7%, 4.5%, 4.2% and 3.5% respectively, totaling the CPI fell by about 0.54 percentage points month-on-month, accounting for more than half of the total CPI decline.
The rise and fall of consumer prices across the country (Source: National Bureau of Statistics)
On the whole, Wen Bin, chief economist of China Minsheng Bank, told Times Finance that the CPI in March failed to continue the momentum of recovery in February.
"From the main features, the prices of some goods and services raised by the Spring Festival factor in February fell by an excessive range in March, mainly concentrated in travel and tourism-related projects, and eventually led to the CPI falling back to around 0 year-on-year. Wen Bin said.
In March this year, price growth slowed down due to the seasonal decline in food prices and the ebb of demand for travel-related services. The fluctuating upward movement of international oil prices and gold prices has driven up domestic refined oil prices and gold jewelry, which has a slight pull effect on CPI.
On a month-on-month basis, the CPI fell by 1.0% in March, of which food prices fell by 3.2%, affecting the CPI to decline by about 0.59 percentage points month-on-month. Among non-food items, the prices of travel services fell more. The increase in travel prices fell to 6.0% from 23.1% in the previous month, and the price of air tickets fell by 14.7% from 20.8% in the previous month, which together affected the CPI to rise by about 0.01 percentage points year-on-year this month.
Zhou Maohua, a macro researcher at the financial market department of Everbright Bank, told Times Finance that with the decline of the holiday effect, food prices and service prices fell significantly in the second month of the Spring Festival.
"But overall, the rebound in domestic demand drove year-on-year price growth. Specifically, the demand for service prices has expanded steadily, and the prices of clothing and gold jewelry have rebounded, as well as crude oil prices have risen. Zhou Maohua said.
A variety of vegetables sold at market stalls. (Source: Picture Worm Creative)
As the highest weight in the food category, the fluctuation of pork prices has a great impact on the change of CPI index. Wen Bin believes that pork prices have fallen due to holiday factors and have not reflected the impact of a short-term rebound.
Specifically, pork prices in March fell significantly from February due to the fading effect of the Spring Festival, down 6.7% month-on-month, and 2.4% year-on-year. In terms of other meats, beef and lamb decreased by 2.3% and 1.7% respectively month-on-month as the climate warmed.
"However, it should be noted that pork prices rebounded in late March due to the de-production capacity in the early stage, the reluctance of some farmers to sell and the second fattening. However, it will not contribute much to the overall March data and may lift the price of pork in the April CPI. Wen Bin said.
All kinds of fresh pork sold in supermarkets Source: Picture Worm Creative
Data from the Ministry of Agriculture and Rural Affairs also showed that in the first week of April, the national pork price reached 25.22 yuan/kg, up 0.2% month-on-month, and has risen for three consecutive weeks.
On the non-food front, energy prices rose modestly and provided limited support to CPI. International oil prices continued to rise in March, domestic refined oil prices rose once at the beginning of the month, and CPI energy prices rose relatively moderately month-on-month. Among them, the fuel for transportation increased by 1.1% month-on-month and 2.2% year-on-year. Under residential items, hydropower fuel was flat month-on-month, up 0.5% year-on-year.
Wu Chaoming, vice president of the Finance and Credit Research Institute, told Times Finance that the core CPI (excluding the core of food and energy) that more truly reflects the economic operation. Judging from the data, in the first quarter, the core CPI increased by 0.7% year-on-year, less than 1%, and also 0.1 percentage points lower than the same period last year.
"Since prices are the result of relative changes in the supply and demand of the real economy, the current pattern of low inflation is essentially a reflection of the prominent contradiction of insufficient effective demand in prices, and it also shows that the policy should be strengthened to enhance the consistency of policy orientation. Wu Chaoming said.
Looking forward to the trend of CPI, Wu Chaoming believes that with the increase of macro policy efforts and the recovery of the demand side during the year, prices are expected to rebound as a whole, and are expected to rise to about 0.2% in the second quarter. It is expected that the CPI will be in a positive growth stage during the year, and the overall recovery will be moderate.
Zhou Maohua believes that the recent off-season of pig prices is not weak, reflecting the rebound in domestic demand, and the impact of the continuous decline in pig production capacity on prices has appeared, coupled with the rise in energy and commodity prices indirectly boosted the price trend, that is, the "pig and oil deflation" situation weakened.
"With the further recovery of consumption, the impact of the improvement of the supply-demand relationship and the decline in the base on prices in the second half of the year may be more obvious. However, the supply in the domestic market remains abundant, and it is expected that the overall price momentum will be moderate during the year. He said.