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China's statistics bureau is to release the country's August inflation figures this Friday. Many economists are expecting price pressures to ease in August from a three-year high in July, as pork prices have stabilized.
Stephen Green, Head of China Research at Standard Chartered Bank, told our reporter Yin Hang that more concrete evidence is needed before the government can adjust its tightening monetary policy.
Stephen Green, head of China Research at Standard Chartered Bank, says the consumer price index, a main gauge of inflation, likely rose 6.3 percent in August compared with the same period a year earlier, down from 6.5 percent in July.
Green said, "We think its going to be about 6.3 percent year-on-year. But for us, the most important thing is to look at the month-on-month figure."
Many economists are expecting price pressures to ease in August from a
three-year high in July, as pork prices have stabilized.
Data released in the past weeks show China's economy continued to decelerate in August. It adds to challenges Chinese policy makers face in keeping inflation in check, while preventing a sharp slowdown.
Chinese Premier Wen Jiabao wrote in an essay last week, that reining in inflation remains China's top priority, despite a slowing domestic economy and uncertain global outlook.
Green said, "The situation is complicated as the Premier has said....I think it'll need a couple of more month of clear evidence of inflation is on the decline. Then we'll see the inflation loosening up a bit."
Challenged by slower economic growth, the Brazilian Central Bank shifted course at its meeting last week to cut interest rates. Some analysts are concerned that as major drivers of global economic growth, it's highly possible that China and India may also adopt the same policy.
But before governments of the two countries consider this choice, questions have been raised about the wisdom of the Brazilian government's surprise decision, after the upturn of the country's August CPI. And experts are saying China will not follow the Brazilian path, as its monetary policy is not as tight compared with Brazil.
Source:Li Wanran