Food prices drove consumers in China to pay more than expected in March, and that in turn could effect a change in government policy on stimulus.
Bloomberg reported Monday that according to China’s National Bureau of Statistics, consumer prices were up 3.6% from a year ago. That is more of an increase than was expected by economists, whose poll responses averaged 3.4%. Food prices drove the increase, coming in at 7.5% higher in March than in February.
“The upside surprise in today’s CPI reading is likely to raise concerns about a possible rebound in inflationary pressures among policy makers,” Song Yu, a Beijing-based economist with Goldman Sachs Group, was quoted saying.
Citing Goldman’s observations on the rising supply of loans and news reports on the government easing restrictions on banks’ lending capacity, Song added, “The data could limit the magnitude of the policy loosening that likely started in March.”