Xie Fuzhan, head of the National Bureau of Statistics (NBS), speaks at a press conference in Beijing, capital of China, Jan. 24, 2008. According to Xie, China's gross domestic product (GDP) grew 11.4 percent year-on-year to 24.6619 trillion yuan (3.43 trillion U.S. dollars) in 2007, and the consumer price index (CPI) was up 4.8 percent, 3.3 percentage points higher than in 2006. (Xinhua/Wang Yongji)
¡¡BEIJING, Jan. 24 (Xinhua) -- Consumer prices in China rose at their fastest pace in a decade last year, with the consumer price index (CPI) increasing 4.8 percent, an increase that might lead to further tightening measures by the government.
Last December alone witnessed a CPI increase of 6.5 percent year on year, lower than the record 6.9 percent rise in November but the same as the figures in August and October.
The National Bureau of Statistics (NBS) announced the CPI on Thursday and identified food prices, especially pork, as the major cause of the increase.
Food prices surged 12.3 percent last year, accounting for 4.0 points of the 4.8-point CPI rise, Xie Fuzhan, director of the NBS, told the media. Average meat and poultry prices rose 31.7 percent in 2007 and egg prices were up 21.8 percent, Xie said.
In addition, he said, surging pork prices had kept the CPI figure above four percent since June. The bureau did not, however, break out pork prices separately in Thursday's report.
"The pork price was underestimated in 2006, which resulted in a sharp decline in the number of pigs, especially sows. The shortfall was further aggravated by a pig cull following a serious outbreak of blue-ear disease last year," he said.
Soaring world commodity prices were another factor that helped drive the CPI to its highest level since 1997. For example, crude oil prices exceeded 100 U.S. dollars per barrel for the first time at the beginning of this year, up from about 25 U.S. dollars in 2003, and edible oil prices nearly doubled last year on international markets, Xie said.
China was forced to raise prices of gasoline, diesel and aviation kerosene by nearly 10 percent from Nov. 1 amid a supply shortfall.
It was necessary to "set China's inflation rate against a worldwide backdrop. India reported a CPI rise of 5.2 percent last year, Russia 9.4 percent, the United States is expected to have a 2.8 percent increase, and Europe has an average rise of above 2 percent," Xie said.
"Generally speaking, China is not alone. The new round of inflation is a global trend," he said.
Money supply also lifted prices, he added. M2, a broad measure of money supply, was 40 trillion yuan (about 5.5 trillion U.S. dollars) last year.
The NBS also reported a 2007 trade surplus of 262.2 billion U.S. dollars, up 84.7 billion U.S. dollars from 2006. Foreign exchange reserves surged 43.3 percent to 1.53 trillion U.S. dollars by the end of 2007.