Chinese inflation continued to rise in January, surpassing government targets and increasing pressure on policymakers to dial back the huge monetary stimulus of the last several years.
The consumer price index rose 4.9 per cent last month, up from 4.6 per cent in December. Although the headline inflation number was lower than expected, it remains above the government’s target of 4 per cent inflation, and may have been effected by a reweighting of the basket from which CPI is calculated.
China has gradually been tightening monetary policy over the last several months by slowing growth in new lending and raising interest rates three times since October.
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