Consumer price per share (CPI) rose by 6.3% in July to a single monthly low in 10 months. However, the industrial product price (PPI) rose by 10% in the month, but it was the highest level since 1996.
The PPI has risen much higher than the CPI and has also appeared in the past. This time, whether the consumer price can gradually decline as expected, the opinions of the parties are not consistent at present. There are also great differences on the reasons for the current price increase and the methods of governance.
Earlier, after listening to the opinions of many parties, the central government decided to maintain a stable and rapid economic growth in the second half of the year and prevent excessive price growth (one guarantee and one control). As the primary task of the macro-adjustment, it continued to suppress the excessive rise in prices. position.
As the former deputy director of the National Bureau of Statistics and dean of the School of Statistics of the Central University of Finance and Economics, He Wei has in-depth research on price statistics and inflation. At the same time, as the vice chairman of the Jiu San Society and the deputy director of the NPC Financial and Economic Committee, he will control how the current price is too fast. Rising, made recommendations to the relevant departments.
At the 5th plenary meeting of the 11th National People's Congress Financial and Economic Committee on July 15 and 16, He Wei and other members listened to the relevant departments' reports on the economic situation in the first half of this year, and discussed and proposed their own Some opinions on macroeconomic regulation in the second half of the year.
On August 12, in response to the current price situation, He Wei accepted an exclusive interview with this reporter.
CPI increase will gradually narrow
"21st Century": How to treat the current price trend?
He Wei: In June this year, the national CPI rose by 7.1% year-on-year; the July CPI rose by 6.3%. I think that prices will gradually decline in the second half of the year, and will basically follow the trend of “8, 7, 6, 5†in the first quarter.
"21st Century": At present, the rise in CPI is still dominated by food consumption. Can this continue to be called structural rise? Can this increase reflect the entire inflation?
He Wei: I believe that if inflation is a monetary phenomenon as defined by the monetarists, then structural price increases do not reflect inflation. The current price increase has nothing to do with the amount of money.
In economics, there is no uniform definition of inflation. Whether inflation is necessarily related to the amount of money, whether price increases are equal to inflation, is a question worth discussing.
The structural price increase is determined by the market. The current rise in food prices is normal and reasonable. In the past, agricultural products were unreasonably priced and farmers’ incomes were low, and they should receive reasonable income. I do not agree with the statement that excess liquidity has caused prices to rise.
"21st Century": Whether the PPI will increase pressure on CPI, how much is the correlation between the two?
He Wei: The rise in PPI will definitely be transmitted to CPI and have an impact. The rise in prices of upstream products has led to an increase in food prices, which is transmitted to the prices of commodities such as pork, grain and wheat.
The biggest impact on PPI is crude oil and iron ore. China's crude oil and iron ore are half dependent on imports. The international price increase of crude oil and iron ore has a great impact on the prices of some upstream products in China. This is the main reason for the current increase in PPI. If the impact of fuel, electricity and ore is ruled out, this year's CPI will remain roughly 5%; but because of fuel, electricity and ore, CPI may exceed 6%.
Crude oil prices are now falling. I believe that the price of ore will also decline to some extent in the near future. Under normal circumstances, ore prices will fall and PPI will also fall. It can be expected that the CPI may therefore fall further, and the probability of its rise is not great.
Relative to the price issue, whether the economy will further decline is more worthy of attention.
"21st Century": Will there be a spiral rise in the price of rising coal prices, or the rise in wages and prices?
He Wei: This situation will not happen. Because China's system and the complete market economy are different, there is no "squatting" between wages and prices, and wages and prices will not spiral upward in China.
Similarly, there will be no spiral increase in coal prices and electricity prices in China. At present, the supply of coal is still sufficient in China. However, China's power generation industry is basically a state-owned system, so it is difficult for coal prices to “fireâ€.
The rise in prices is mainly the adjustment of unreasonable prices.
"21st Century": What type of domestic price increase is currently in the market?
He Wei: I believe that the current domestic price increase cannot be attributed to cost-driven or demand-driven type, nor can it be attributed to excess liquidity.
At present, the international food price rise is very fierce, and the transmission effect makes the price of Chinese food and agricultural by-products rise, which is not a complete demand pull. Because it is driven by demand, there must be a shortage of supply, and there is no shortage of supply.
Due to the rising prices of oil and iron ore, this is indeed a cost boost. However, the current CPI increase is only about 1% driven by cost, and the remaining 6 percentage points is the market's adjustment to unreasonable prices.
Therefore, I don't think that the current price increase is inflation. Secondly, I don't think it is inflation driven by cost or demand.
"21st Century": What effective measures can be taken to control this high price operation?
He Wei: First of all, we must strengthen agriculture. At present, the State Council has adopted a series of effective measures, which are effective. Adequate supply of agricultural products is conducive to curbing food price increases.
Second, we must strengthen the management of the circulation field and combat speculation. Some commodities have risen too sharply. For example, the substantial increase in prices of agricultural products may have a certain relationship with speculation and other behaviors. This requires the government to carefully manage the mobile sector. In this way, rising prices can be slowly controlled.
The optimal inflation control target is not that the CPI is as low as possible, not even zero, and the CPI should be maintained at 3%-5%.
"21st Century": What is the current total demand for controlling prices? What is the appropriate level of CPI and GDP?
He Wei: Demand is determined by income. The current aggregate demand is stable, which has an extraordinary significance for stabilizing prices. I believe that GDP should be controlled in the range of 9%-10%. If the GDP is below 9% this year, the economy will decline, which needs to be highly valued. The CPI is around 6%, and there is nothing terrible. I expect the CPI situation to be below 6% next year.
Earphones Plug Wireless,Wireless Earphone,Earphones For Iphone,Earphone For Samsung,wireless bluetooth earphone
Shenzhen Konchang Electronic Technology Co.,Ltd , https://www.konchangs.com