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Food price rises fuel inflation

China's inflation rebounded in January as food prices soared, renewing pressure on Beijing to control living costs as it tries to boost slowing growth amid warnings of a looming global downturn.

Consumer prices in the world's second-largest economy rose by an unexpectedly strong 4.5% over a year earlier, up from December's 4.1%, data showed.

Food prices jumped 10.5%, accelerating from the previous month's 9.1% rate.

"It makes us more concerned that the risk of inflation is not going away," said Nomura economist Zhiwei Zhang.

Among Chinese planners "it will reinforce concerns about inflation that already were there".

The price spike could complicate the communist government's efforts to revive growth that slowed to a two-and-a-half-year low of 8.9% in the final quarter of 2011.

Chinese leaders are gradually easing controls to boost growth and job creation but are moving cautiously for fear of igniting a new price spiral.


From Belfast Telegraph