Home >

Fang Gang: China'S CPI Is Expected To Stabilize Below 4% In 2011.

2011/3/21 15:43:00 65

Fang Gang, member of the monetary policy committee of the people's Bank of China and director of the China National Economic Research Institute, said 19 days that the central bank decided on Friday to raise the deposit reserve ratio to 20%.

Over the past year, the central bank's policy measures have recovered a large amount of money and improved the problem of excess liquidity.

Therefore, he predicted that the overall price level will increase below 4% this year.

Fang Gang said at the eleventh summit of China Development Summit held by the development research center of the State Council.

Through currency

Recovery, hedging and other policies recover liquidity. Now 30% of China's currency is locked by the central bank.

He said that at the same time, by issuing central bank bills to commercial banks, the central bank withdrew about 5% of the total currency liquidity.

Recently, the central bank has also guided through the window to control the amount of loans. The monetary ratio controlled by the central bank accounts for about 3%-4% of the total amount of money.

Fang Gang said that the total price level rose by 3.3% last year, of which the monthly consumer price index (CPI) once exceeded 5%.

This increase is not very high compared with international or domestic prices.

The reason why the domestic response is very strong is mainly related to high housing prices and a certain degree of bubbles in the real estate market.

"70% of the low-income group's main consumption is food, so the whole

CPI

Though not high, when the food price rises by 10%, the low-income group feels very strong.

He said.

Turning to the reasons for the current price rise, Fang Gang pointed out that too much money and excess liquidity were the first to bear the brunt.

In addition, the Fed's two quantitative easing policy measures increased the expectations of the dollar devaluation and the rising commodity prices in the world market, making the price of oil and other commodities higher.

When it comes to the regulation and control policy of the property market, Fang Gang said that the housing market is basically stable now.

Despite the high housing prices in some big cities, especially in the whole country, the two or three tier cities have stabilized.

In the long run, monetary policy still needs improvement.

He believes that China should improve the efficiency of money utilization and speed up.

Currency operation

To make up for the slowdown in the growth rate of money, so that the economy will gradually return to a relatively balanced track.