PRICE CONTROLS ON FOOD IN CHINA
November 17th, 2010Via: BBC:
China’s premier Wen Jiabao has said the government is preparing new measures to stem double-digit food price inflation.
“The state council is formulating measures to curb the overly fast rises of prices,” he said in a statement on the government’s website.
He gave no details, but they are said to include price caps, subsidies and penalties for food hoarding.
Meanwhile the Shanghai stock exchange has fallen nearly 10% in four days on fears of interest rate rises.
Painful price rises
The People’s Bank of China raised rates unexpectedly in October in response to growing inflation pressures, and has adopted a more hawkish tone since.
Consumer price inflation rose to 4.4% in October, which was up from 3.6% a month earlier and its highest level in two years.
Food price inflation has become particularly acute in China, with food prices rising 10.1% last month.
The average wholesale price of some vegetables in Chinese cities rose by nearly two-thirds in the first 10 days of this month, raising fears that food hoarding was exacerbating shortages.
