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China:Chinaˊs consumer price index may exceed 2.9% in March
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PublishDate:
2007-03-29 15:27:00
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BEIJING, March 28 (Xinhua) -- China's consumer price index (CPI) may rise 2.9 percent in March compared with the same month last year, according to the country's mid-sized lender Industrial Bank.

Lu Zhengwei, an official at the bank's Capital Operation Center, said steeper grain prices were continuing to fuel inflation.

Lu said that February's CPI of 2.7 percent was 0.3 percentage points lower than expected thanks to slower increases in housing prices and small cuts in travel and telephone costs.

The index, a major gauge of inflation, stood at around 1.5 percent for most of 2006 before picking up speed to reach 2.8 percent in December, the highest increase in 22 months, and 2.2 percent in January.

Analysts blamed grain price hikes for the inflation.

The People's Bank of China, or central bank, said earlier that the nation's grain prices rose 9.1 percent in December compared with the same month in 2005.

The grain price rose 6.9 percent year-on-year in January and 6.8 percent in February, according to the National Bureau of Statistics.

China wants to limit inflation to 3.0 percent in 2007, according to the government work report delivered by Premier Wen Jiabao earlier this month.

The central bank raised one-year benchmark interest rates by 0.27 percentage points as of March 18 amid concerns about inflationary trends.

The Ministry of Commerce earlier estimated the CPI was expected to climb 2.5 percent for the whole year of 2007 due to a range of factors including higher gasoline prices.

Source: Xinhua News
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