Price operation remains basically stable (Rui Finance) percentage point | decrease | price

On July 10th, consumers were shopping for vegetables at a supermarket in Pingyi County, Linyi City, Shandong Province. Photography by Wu Jiquan

According to data released by the National Bureau of Statistics on July 10th, the national consumer price index remained unchanged year-on-year in June; On average, from January to June, the national consumer price increased by 0.7% compared to the same period last year. Experts pointed out that in June, the consumer market remained relatively stable, with CPI slightly decreasing month on month and remaining unchanged year-on-year. From the perspective of the whole year, as market demand steadily expands and production supply gradually increases, the supply-demand relationship is expected to remain generally stable, and consumer prices for residents will maintain a moderate increase.

Service prices have changed from a decrease to an increase compared to the previous month

Since the beginning of this year, the year-on-year increase in consumer prices has generally declined. From the situation in June, the CPI increased by 0.2% last month and remained stable.

"Among them, food prices increased by 2.3%, an increase of 1.3 percentage points compared to the previous month." Dong Lijuan, Chief Statistician of the City Department of the National Bureau of Statistics, introduced that in the food industry, prices of fresh vegetables, potatoes, fresh fruits, and poultry have increased significantly, with an increase of 4.3% to 10.8%; The price of pork decreased by 7.2%, an increase of 4.0 percentage points from the previous month.

Ding Yujia, a researcher at Zhixin Investment Research Institute, analyzed that in June, the increase in fresh vegetable prices was mainly affected by high temperatures and rainy weather, while the decrease in pork prices was affected by sufficient market supply and seasonal decrease in pork consumption. In addition, the overall supply of eggs, fresh fruits, and aquatic products is sufficient, and prices have decreased month on month, with a decrease rate between 1.2% and 2.6%.

In terms of non food prices, the year-on-year decrease in June was 0.6%, down 0.1% compared to the previous month, and the decrease was the same as the previous month. Dong Lijuan stated that from a month on month perspective, non food products have been affected by the decline in international oil prices, resulting in a 0.7% decrease in domestic energy prices, which is 0.5 percentage points larger than the previous month; Affected by factors such as the 618 merchant promotion, the prices of industrial consumer goods excluding energy remained unchanged from the previous month and decreased by 0.3%; Service demand continues to recover, and service prices have increased by 0.1% from a decrease of 0.1% last month.

According to calculations, in the year-on-year changes in CPI in June, the tail effect of price changes from the previous year was about 0.5 percentage points, the same as the previous month; The new impact of price changes this year is about -0.5 percentage points, compared to -0.3 percentage points last month.

The decline in PPI is affected by the decline in commodity prices

The data released by the National Bureau of Statistics on that day also showed that in June, the ex factory price index of industrial producers decreased both month on month and year on year. Among them, the year-on-year decrease was 5.4%, and the decrease was 0.8 percentage points larger than the previous month; The month on month decrease was 0.8%, and the decrease narrowed by 0.1 percentage points compared to the previous month.

"The decline in PPI is mainly due to the continued decline in prices of major commodities such as oil and coal, as well as factors such as a relatively high base compared to the same period last year." Dong Lijuan said that from a year-on-year perspective, the prices of means of production decreased by 6.8%, with a 0.9 percentage point increase in decline; The price of living materials decreased by 0.5%, with a decrease of 0.4 percentage points. Among the 40 major categories of industrial industries surveyed, 25 showed a decrease in prices, a decrease of 1 compared to the previous month.

According to data from the National Bureau of Statistics, in June, prices in major industries such as oil and gas extraction, petroleum coal and other fuel processing, chemical raw material and chemical product manufacturing, coal mining and washing decreased by 14.9% to 25.6%, and the decline has all expanded. The total impact of the four oil and coal related industries on PPI decreased by about 2.81 percentage points year-on-year, which is 0.71 percentage points more than the impact of last month.

"Overall, the prices of upstream mining and raw material industries in the means of production have expanded month on month and year-on-year, while the prices of downstream processing industries have narrowed month on month and year-on-year, indicating an improvement in the profits of middle and downstream enterprises." Ding Yujia analyzed that in June, the prices of black metal smelting and rolling processing industries, non-ferrous metal smelting and rolling processing industries, decreased by 16.0% and 7.2% year-on-year, respectively, with a narrowing of 0.8 and 1.2 percentage points.

In addition, some technology intensive industries are experiencing price increases. Dong Lijuan introduced that in June, aircraft manufacturing prices increased by 1.0% month on month, smart consumer equipment manufacturing prices increased by 0.4%, and medical instrument and device manufacturing prices increased by 0.2%.

The supply and demand relationship is expected to be generally stable

What is your view on the current price situation? What will be the future trend? Multiple analyses suggest that the current Chinese economy is not experiencing deflation, nor is there a foundation for long-term deflation or inflation, and price increases will gradually return to a reasonable level.

"At present, the overall low level of CPI growth is affected by multiple factors such as the complex and severe international environment, the sluggish world economy, still insufficient domestic demand, and a relatively high base in the same period last year. Overall, it is a phased process." Fu Linghui, spokesperson for the National Bureau of Statistics, said that in the next stage, as China's economy recovers, the employment situation gradually improves, and household income growth accelerates, it is conducive to expanding consumption and will drive the rebound of CPI growth.

Industry insiders analyze that in recent months, CPI and PPI have decreased month on month. On the one hand, this is due to the time gap between supply and demand recovery. With strong support from a package of policies to stabilize the economy, domestic production continues to accelerate, agricultural and sideline product production is stable, logistics channels are smooth, and residents have sufficient supply of "vegetable baskets" and "rice bags". At the same time, the demand for bulk consumption such as automobiles and home decoration is weak; On the other hand, due to the significant base effect, international oil prices once approached the $140/barrel mark last year, but have significantly declined since the beginning of this year, driving down China's year-on-year price increase; Last March, the prices of fresh vegetables rose out of season due to the disturbance of the epidemic, which also had a high base impact on this year. Looking ahead to the second half of the year, CPI is expected to gradually rebound, with a year-on-year CPI of over 1% by December.

"Throughout the year, with the steady expansion of market demand in China and the gradual increase in production and supply, the supply-demand relationship is expected to remain generally stable, and overall consumer prices are expected to maintain a moderate increase," said Fu Linghui.

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