China inflation rises as industrial output growth slows: gov't
By Fran Wang ,AFPBEIJING -- Chinese inflation hit a 10-month high in February while growth in industrial production and retail sales slowed, official data showed on Saturday, complicating policymakers' efforts to boost recovery.
March 10, 2013, 12:13 am TWN
Growth in the world's second-largest economy slowed to a 13-year low of 7.8 percent in 2012, though a pick-up in the final three months had raised hopes for a rebound this year.
The consumer price index — a main gauge of inflation — rose 3.2 percent year-on-year in February, according to the National Bureau of Statistics (NBS), as holiday season spending and rapid credit growth accelerated price rises.
The figure was a spike from January's 2.0 percent and the highest result since April 2012, when it stood at 3.4 percent. It was also above the median forecast of 3.0 percent in a poll of 14 economists by Dow Jones Newswires.
Inflation is a key issue for the ruling Communist Party as it brings with it the risk of popular discontent over rising prices and the threat of social unrest.
Other indicators announced Saturday by the NBS provided further signs that a budding recovery may be fragile.
“The Chinese government is caught in the dilemma of dealing with slower growth and yet higher inflation again,” Ren Xianfang, a Beijing-based analyst with research firm IHS Global Insight, said in a research note.
Industrial output, which reflects production at China's factories, workshops and mines, rose 9.9 percent year-on-year over the first two months of 2013, compared with 11.4 percent in the same period of 2012.
Retail sales — the main gauge of consumer spending — were up 12.3 percent over the period, slowing from 14.7 percent in the January-February period of last year.
Giving the figures for the two-month period minimized distorted comparisons due to the Lunar New Year, which fell last month this year but in January for 2012.
Fixed-asset investment — a key measure of official spending on infrastructure — rose 21.2 percent in January-February, higher than the 20.6 percent for the full year of 2012 and underscoring what analysts say is an old-fashioned recovery led by fast investment growth.