Most of the economic organizations interviewed by China Business News believe that China's Consumer Price Index (CPI) will reach 5 percent in July and the People's Bank of China, the country's central bank, will probably raise interest rates again in the second half of 2007.
Li Huiyong, a macro-analyst with Shenyin & Wanguo Securities Co., Ltd. (SYWG), says in his research report that July's CPI shows a faster rising trend because commodities such as pork continue undergoing price hikes and an increasing number of consumables are experiencing price rises. He estimates that the CPI will rise to 5.1 percent in July, 0.7 percentage points higher than June's number. He also predicts that July's CPI can even reach 5.3 percent because natural disasters such as floods may push prices even higher.
Lin Zhaohui, an analyst with Guotai Junan Securities believes that July's CPI will definitely reach over 5 percent due to the solid rises in food prices.
As a result, Lin thinks, the possibility cannot be ruled out that the central bank will raise the interest rates again in September, especially deposit rates.
For more details, please read the full story in Chinese. (http://www.china-cbn.com/s/n/000002/20070807/000000075136.shtml)
(China.org.cn August 7 2007)
