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China’s inflation hits 6.4 per cent, highest level in three years
Higher prices affect in particular food. Pork prices jump 57.1 per cent over June 2010. The authorities fear rising social tensions.
Beijing (AsiaNews/Agencies) – China’s inflation reaches highest level in three years, despite a series of interest rate rises and curbs on bank lending. Prices in June rose 6.4 per cent from a year earlier.
Foodstuffs are the most affected. The price of pork, a staple in the Chinese diet, rose 57.1 per cent over 2010. Recent flooding pushed up the prices of rice and soy as well.
Analysts say Chinese authorities are concerned that the rising cost of basic foodstuffs could fuel social unrest.
For them, rising prices are one of the obstacles to the government’s growth policy. For this reason, they have made tackling inflation their top priority. Since the start of the year, interest rates have been raised three times.
However, many economists expect China's inflation to cool in the second half of the year as world oil prices ease.
At the same time though, they are watching for evidence that higher costs are filtering into a broader swathe of the economy, which might negatively affect exports, already declining at a rate of 21 per cent a year.