BartBlog

BEIJING–China’s inflation rate has accelerated to the highest monthly rate in a decade, driven by a 15.4 per cent annual surge in politically sensitive food prices.

Prices of pork and other meat leaped 45.2 per cent and eggs 30.6 per cent in July over the year-earlier period, China’s National Bureau of Statistics reported yesterday.

The month’s inflation rate of 5.6 per cent was the highest since February 1997, and an increase over June’s 4.4 per cent.

Chinese leaders fear the country’s boom – the economy grew 11.9 per cent in the latest quarter – might ignite inflation.

They have tried to cool things off by raising interest rates three times in the past six months, and economists expect one to two more increases this year.

But a statistics bureau spokesperson yesterday tried to quell fears of a pickup in overall inflation, stressing that July’s sharpest increases were limited to food. Prices of clothing and other non-food goods rose just 0.9 per cent in July from a year earlier.

“As industrial-product prices and service prices remain relatively stable, the prices should not rise in an all-around and sharp way,” said spokesperson Li Xiaochao, quoted by the official Xinhua News Agency.

Yao Jingyuan, the bureau’s chief economist, said inflation might continue to rise over the next two months due to food-price hikes, Xinhua also reported.

It said Yao predicted the inflation rate would fall in the final quarter of the year.