According to the latest data released by the National Bureau of statistics on February 16, in January 2022, PPI (Industrial producer price index) decreased by 0.2% month on month and increased by 9.1% year-on-year; CPI (consumer price index) rose 0.4% month on month and 0.9% year-on-year.
PPI will continue to decline in 2022. first of all, from the perspective of China, the gradual decline of PPI year-on-year data reflects the strong promotion of the policy of ensuring supply and stabilizing price, and the effect of the policy is being effectively displayed. The prices of Chinese priced varieties such as coal and rebar have fallen relatively significantly, including the prices of coal mining and washing industry and ferrous metal smelting and calendering industry, which have decreased by 3.5% and 1.9%. Secondly, from abroad, affected by the recovery of international crude oil prices, Petrochina Company Limited(601857) related industry prices began to gradually pick up in the short term. Among them, the price of oil and natural gas exploitation industry increased by 2.6% from 6.9% last month; The prices of chemical raw materials, chemical products manufacturing and chemical fiber manufacturing decreased by 1.3% and 0.1% respectively, 0.8 and 3.0 percentage points lower than that of the previous month. At present, the global supply chain is being gradually repaired, the tension is gradually alleviated, the ultra loose monetary policy of the United States and other developed economies will begin to accelerate the reduction and exit, the PPI data is expected to continue to fall, and the supply impact caused by imported inflation has been basically alleviated.
in 2022, CPI will continue to be dragged down by pig prices in the short term and will gradually rise in the long term. among the CPI year-on-year itemized foods, the price of pork decreased by 41.6% due to the base of the same period last year and the sufficient supply of pork caused by the acceleration of the slaughter of newborn pigs before the festival, expanding by 4.9 percentage points, becoming the main drag item in the short term. However, with the leading indicators, the number of fertile sows will gradually decline year-on-year, and the number of pigs will also peak year-on-year. It is expected that the supply of pigs will peak in this round of pig cycle in the third quarter, which will also correspond to the gradual recovery after the bottom of pig price. In the long run, CPI data will gradually recover, but the recovery momentum will be relatively mild, with the efforts of cross cyclical and counter cyclical macro-control policies and the transmission of the price rise effect of upstream raw materials.
On the whole, the inflation data still shows that economic development is facing the pressure of shrinking demand and weakening expectations, especially the lack of final consumption and effective investment in domestic demand. according to the PMI and social finance data in January, the development dilemma of small and medium-sized enterprises is the core pain point for the current steady economic growth, because the key to ensuring people’s livelihood and employment is to ensure market players, especially small and medium-sized micro enterprises that contribute about 80% of employment.
In January 2022, CPI and PPI continued to show a double downward trend, and the scissors gap narrowed from 8.8 percentage points last month to 8.2 percentage points, providing favorable conditions for the formulation of macro policies. At present, the position of marginal easing of monetary policy has been confirmed. The policy force should be appropriately advanced, and the toolbox of monetary policy should be opened wider and ahead of the market curve. The prudent monetary policy, while adhering to the premise of not engaging in “flood irrigation”, has achieved sufficient, accurate and forward force.
* the author Zhang Aoping is a well-known economist, venture capital expert and President of incremental Research Institute. At the same time, he also serves as the distinguished expert of People.Cn Co.Ltd(603000) people’s venture capital expert advisory committee, the distinguished economic consultant of Shandong Youth Enterprise Association of Shandong Provincial Committee of the Communist Youth League, the expert member of Beijing Centergate Technologies (Holding) Co.Ltd(000931) digital culture industry think tank, the chief economist of Vietnam construction securities China Invited lecturer of the Financial Society of Changjiang business school, etc., and won the young economist of Nankai financial chief economist forum in 2021.
