2022 Price of China Economic Watch
Xinhua News Agency, Beijing, December 10th: Accurately Guaranteeing Supply, Stabilizing Prices and Showing Economic Resilience —— Price Articles of China Economic Watch 2022.
Xinhua News Agency reporters Wei Yukun, Zou Duowei and Chen Guofeng
Statistics from the National Bureau of Statistics show that from January to November this year, the national consumer price index (CPI) rose by an average of 2% over the same period of the previous year, with an increase of 1.6% in November, down 0.5 percentage points from the previous month.
Since the beginning of this year, global inflation has remained high. China’s economy has adhered to the general tone of striving for progress while maintaining stability, accurately grasped the strength of policy to ensure supply and stabilize prices, kept prices running smoothly, and demonstrated its economic resilience. In summing up this year’s work, the the Political Bureau of the Communist Party of China (CPC) Central Committee meeting held on December 6th pointed out that "employment prices are basically stable, and food security, energy security and people’s lives are effectively guaranteed".
China’s CPI has become a "stabilizer" for global prices in a reasonable range.
Statistics show that as of November, the monthly year-on-year increase of CPI in China is lower than the expected target of about 3%, and the year-on-year increase of core CPI excluding food and energy prices fluctuates in the range of about 1%.
Since the beginning of this year, stabilizing prices has faced many challenges. Outward, influenced by the Ukrainian crisis and other factors, global inflationary pressure has increased, and imported inflationary pressure has increased; Looking inward, since March, the domestic epidemic situation has rebounded, especially in recent times, the local epidemic situation is severe and complicated, and the pressure of ensuring supply and stabilizing prices is under pressure.
Keeping prices running smoothly is very important to stabilize the basic economy.
Since the beginning of this year, all localities and departments have implemented the decision-making arrangements of the CPC Central Committee and the State Council, scientifically grasped the strength, rhythm and key points of policies, resisted the pressure in the face of complex situations, and refrained from engaging in "flood irrigation" type of strong stimulus. China’s important commodities for people’s livelihood and basic energy are stable in quantity and price, which has become an important "stabilizer" for global prices.
Food price is the basis of all prices. A series of extraordinary and super-strong measures have been introduced one after another to consolidate the foundation of grain production-
The central government issued a total subsidy of 40 billion yuan in three batches to alleviate the impact of rising agricultural prices on increasing grain production; Agricultural science and technology service personnel went to the fields to promote the weakening and strengthening of wheat … This year, the total output of early rice and summer grain increased by 3.1 billion Jin, which strongly supported the stable operation of prices.
Ensuring the supply and stable prices of important livelihood commodities is related to people’s lives. Many places across the country have strengthened the organization of goods supply, strengthened the monitoring and early warning of the daily necessities market, and unblocked the "last meter" distribution channel to ensure that the quantity and price of people’s livelihood goods are stable. The data shows that the year-on-year increase in food prices has dropped for two consecutive months, with the increase in November falling by 3.3 percentage points from the previous month.
"Prices have always maintained a stable operation, which fully reflects China’s strong economic resilience, large market scale, and effective measures to ensure supply and stabilize prices." Guo Liyan, director of the Comprehensive Situation Research Office of China Macroeconomic Research Institute, said.
The year-on-year growth rate of PPI dropped sharply, and the cost pressure of enterprises in the middle and lower reaches eased.
Affected by factors such as the high comparison base in the same period last year, the national industrial producer price index (PPI) changed from an increase of 9.1% in January to a decrease of 1.3% in November. From January to November, PPI increased by 4.6% on average compared with the same period of last year, which was lower than the 8.1% increase in the whole year of last year.
The high price of industrial products will inevitably increase the production costs of enterprises in the middle and lower reaches and affect the expected stability of the market. Since the beginning of this year, in view of the obvious increase in commodity prices, the relevant state departments have taken timely measures such as two-way regulation of supply and demand and joint supervision of the spot market to curb unreasonable price increases and promote the orderly decline of PPI growth.
From May 1 this year to March 31, 2023, a provisional import tax rate of zero will be imposed on all coal; Improve the medium and long-term trading price mechanism of coal, and clarify the behavior of operators in the coal field to drive up prices; Intensify oil and gas exploration and development …
Thanks to a series of measures to ensure supply and stabilize prices, the prices of bulk commodities have generally fallen, which has led to a significant decline in the prices of coal, iron ore mining and steel smelting and calendering. In November, the price of ferrous metal smelting and rolling processing industry decreased by 18.7%, and the coal mining and washing industry decreased by 11.5%.
"The year-on-year growth rate of PPI continues to fall, which will help improve the profit structure of upstream and downstream industries, ease the cost pressure of manufacturing enterprises in the middle and lower reaches, and stimulate the vitality of micro-subjects." Wang Likun, an associate researcher at the Institute of Market Economy of the State Council Development Research Center, said.
Guo Liyan analyzed that as major economies such as the United States and Europe continue to raise interest rates, the economic growth rate slows down, and the cardinal utility is superimposed, the international commodity prices may continue the overall downward trend, or may drive the domestic PPI to run weakly.
Make overall plans to ensure stable supply, price and price, and protect the people’s "rice bags" and "vegetable baskets"
The the Political Bureau of the Communist Party of China (CPC) Central Committee meeting held on December 6th emphasized that "it is important to do a good job in stabilizing growth, employment and prices" and "it is necessary to make overall plans to ensure the supply and price of important commodities for people’s livelihood and ensure the supply of coal, electricity, oil and gas transportation".
Organize the release of central reserve meat to increase market supply; Further compact the mayor’s responsibility system of "vegetable basket" to ensure the production and supply of key agricultural products in winter and spring … Recently, all localities and departments have implemented the central deployment, actively done a good job in ensuring supply and stabilizing prices, and kept the "rice bag" and "vegetable basket" of the people firmly.
Xinfadi market is called the "vegetable basket" of Beijing citizens. At present, the market supply of vegetables is stable, and the trading volume is maintained at 18,000 tons per day.
"The logistics park is judged by big data, actively coordinating merchants and suppliers to organize the supply of goods, ensuring that the daily dynamic inventory is above 10,000 tons, and fully ensuring the supply of vegetables." Fan Libo, manager of vegetable management department of Shandong Shouguang Dili Agricultural Products Logistics Park, said.
Looking forward to the future price trend, Fu Linghui, spokesman of the National Bureau of Statistics, said that in the next stage, consumer prices are expected to maintain a moderate upward trend.
From the perspective of supply fundamentals, the production situation of meat, eggs, milk, fruits, vegetables and fish in China is good and the supply is sufficient. In early November, the area of vegetables in the field was 90.799 million mu, an increase of 1.631 million mu year-on-year; From May to July, the number of newborn piglets was basically the same as that of the same period of last year, which means that the amount of live pigs slaughtered before the Spring Festival in November to 2023 was basically the same as that of the same period of last year, and the sharp increase in pork prices was not supported.
Judging from the market demand, at present, due to the complicated and severe situation at home and abroad, the market demand is still recovering, and the price pull is relatively limited.
"In the next step, we will continue to increase the supply organization and transportation capacity in areas with severe epidemics, guide and optimize the terminal distribution measures, and do our best to ensure the supply of people’s living materials." Shu Yuting, a spokesperson for the Ministry of Commerce, said.