Event overview
On January 12, 2022, the National Bureau of Statistics announced the CPI and PPI in December 2021. The year-on-year CPI was 1.5%, the expected value was 1.7%, and the previous value was 2.3%; PPI was 10.3% year-on-year, the expected value was 10.8%, and the previous value was 12.9%;
Investment view
CPI and PPI both fell, making it difficult to restrict monetary policy
Affected by the continuous effect of the policy of guaranteed supply and stable price and the decline of international commodity prices such as crude oil and nonferrous metals, PPI continued to fall sharply year-on-year in December and turned negative for the first time since June 2020; The fall of pork, fresh vegetables and other food prices and the decline of non food prices led to the decline of CPI. In the future, with the slowdown of the growth of major economies in the world and the gradual ebb of loose policies in overseas developed countries, the demand for upstream raw materials will gradually slow down. At the same time, with the continuous promotion of China's "supply guarantee" policy, the black price will also turn reasonable, and PPI will continue to fall. For CPI, the disturbance of short-term rise in fresh vegetable prices has gradually subsided. At present, there is still too much supply of pigs, and pork prices will "double bottom" after the Spring Festival. Therefore, the subsequent upward trend of CPI will be relatively mild, and the first half probability is less than 2%, which is difficult to restrict monetary policy.
In December, CPI fell year-on-year and turned negative month on month; Food turned negative year-on-year, and non food fell year-on-year
In December, CPI was 1.5% year-on-year, down 0.8 percentage points from the increase in November. The year-on-year negative turn of food prices was the main reason for the year-on-year decline of CPI. Food prices changed from 1.6% in the previous month to - 1.2% year-on-year, affecting the decline of CPI by about 0.22 percentage points; Non food prices rose by 2.1% year-on-year, down 0.4 percentage points from the previous month, affecting the CPI to rise by 1.69 percentage points. The month on month increase changed from 0.4% last month to a decrease of 0.3%.
Food and non food prices turned negative month on month
Food prices rose by 2.4% month on month to a decrease of 0.6%, affecting the CPI to decline by about 0.10 percentage points. The sharp drop in pork and fresh vegetable prices is the main reason for the month on month decline in food prices. With the end of residents\' pickled bacon in winter and the increase of pigs, the price of pork fell sharply by 11.8 percentage points compared with the previous month; In addition, with the introduction of local measures to protect the "vegetable basket", the number of fresh vegetables on the market gradually increased, and the month on month increase changed from 6.8% to 8.3%.
Non food prices fell by 0.2% month on month from flat last month, affecting the decline of CPI by 0.17 percentage points. Among them, the price of industrial consumer goods increased from 0.3% last month to 0.5%, which is mainly related to the decline of crude oil price, in which the prices of gasoline and diesel decreased by 5.4% and 5.8% respectively; The service price decreased by 0.3% from last month to flat, of which the price of housekeeping service increased by 1.3% and the price of hotel accommodation decreased by 0.8%.
The core CPI excluding food and energy prices was 1.2% year-on-year, unchanged from the previous month.
Raw material prices continued to decline, and PPI fell year-on-year and month on month in December
In December, PPI increased by 10.3% year-on-year, down 2.6 percentage points from the previous month. Among them, the means of production was 13.4% year-on-year, down 3.6 percentage points; The means of living increased by 1.0% year-on-year, the same as that of the previous month. PPI changed from flat to - 1.2% month on month, which is also the first negative turn since June 2020.
There are two reasons for the sharp decline of PPI in December: first, the effect of China's policy of ensuring supply and stabilizing prices continues to show, and the prices of coal and steel continue to fall; Second, the prices of some international commodities such as crude oil and nonferrous metals fell. Among them, the price of coal mining and washing industry decreased by 8.3%, and the decline expanded by 3.4 percentage points; The price of coal processing decreased by 15.4%, and the decline was expanded by 7.0 percentage points; The price of ferrous metal smelting and rolling processing industry decreased by 4.4%, and the price of non-metallic mineral products industry decreased by 1.4%; Lower international crude oil and nonferrous metal prices have driven down the prices of relevant industries in China. The price of petroleum exploitation decreased by 8.3%, the manufacturing price of refined petroleum products decreased by 4.0%, and the price of chemical raw materials and chemical products decreased by 2.1%; The price of non-ferrous metal smelting and rolling processing industry decreased by 1.4%. However, affected by the rise in the price of imported natural gas, the growth of relevant industries has expanded, including the price of gas production and supply industry increased by 5.3%.
Risk tips
Unexpected changes in economic activity
