China's CPI Up 1.9% in December

Concerns about inflation hardened as the release of major economic indicators in China earlier today revealed that the country's consumer price index (CPI) rose by 1.9% in December.

Though the index, a main gauge of inflation, registered negative growth for nine months of the year and, according to today's announcement, fell 0.7 percent over the whole year, it continued to rise in December, up 1.9 percent from a year earlier, after growth first turned postive in November.

The producer price index (PPI) dropped 5.4 percent in 2009, but a 12 month string of declines was brought to an end with the index up 1.7 percent in December when compared to the level of December 2008, according to figures announced by Ma Jiantang, head of China's National Bureau of Statistics.

Ma also revealed that as of the end of December, China's financial institutions had a total of 40 trillion yuan worth of outstanding loans, indicating that 9.6 trillion yuan of new yuan-denominated loans had been issued in 2009, nearly double the government's intitial target of 5 billion yuan and up almost 32 percent year-on-year.

Other economic indicators announced at the press conference included annual money supply, retail sales and income statistics.

The broad measure of money supply, M2, which covers cash in circulation and all deposits, was said to have risen 27.7 percent from a year earlier to 60.6 trillion yuan as of the end of December.

The narrow measure of money supply, M1 (cash in circulation plus current corporate deposits), was up 32.4 percent to 22 trillion yuan.

Total retail sales of consumer goods reached 12.5343 trillion yuan in 2009, up 15.5% on the previous year's total, or 16.9 percent in real terms, which account for inflation. This was 2.1 percentage points higher than the rate of growth in real terms registered in 2008.

It was also announced that per capita total income of urban households amounted to 18,858 yuan in 2009, 9.8% higher than last year, after adjusting for price factors. Average rural per capita net income was 5,153 yuan last year, up 8.5% in real terms on the previous year after adjusting for price fluctuations.

1 US dollar = 6.827 yuan

Links and Sources

National Bureau of Statistics: Main Statistical Data 2009 (Chinese)

National Bureau of Statistics: National Economy: Recovery and Posing in the Good Direction in 2009