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Price hikes stoke inflation fears

By Fu Jing (China Daily)
Updated: 2006-07-26 08:09

The price rises for raw materials, fuel and power could speed up consumer price increases, he said.

Consumers are already feeling the pinch.

A recent national survey of 20,000 households in 50 cities conducted by the People's Bank of China, the central bank, found that one in every four urbanites thinks prices for goods and services are "rather high and unacceptable."

Some experts, however, do not believe inflation is imminent.

Wang Xiaoguang, a researcher with the Macro-economic Research Academy affiliated to the NDRC, said that supply of most products surpasses demand and there is little room for the CPI to pick up.

"There is no evidence that China is facing inflation," he said.

In a related development, the NDRC announced yesterday that government revenues for the first half of the year reached 2 trillion yuan (US$250 billion), or about 66 per cent of the figure for the whole of last year.

The figure was 360 billion yuan (US$45 billion) more than the same period last year, said spokesman Han, attributing it to fast economic growth and improved industrial efficiency.

The NDRC warned local governments not to get carried away by increased revenues and splurge on wasteful projects.