Panic buying sends Chinese inflation to five-month high
FOOD stockpiling and supply chain woes pushed China’s inflation rate to a five-month high in April as Beijing hit back against the World Health Organisation’s criticism of the country’s zerocovid policy as “irresponsible”.
A surge in food and energy bills boosted consumer price growth from 1.5pc in March to 2.1pc, in a faster than expected pick up in costs for households. The uptick was driven by the country’s zero-covid stance as demand became driven by panicking shoppers stocking up after Beijing put swathes of its biggest cities into lockdown.
As more evidence of the economic damage done by its draconian restrictions emerged, Beijing dismissed criticism by Tedros Adhanom Ghebreyesus, the WHO director-general, as “irresponsible”.
He was told by China’s foreign ministry to “get a better understanding of the facts” after he suggested Beijing’s strict approach is unsustainable.
The consumer prices index hit its highest level since November, pushed up by energy bills in China increasing by an estimated third in the past 12 months. The National Bureau of Statistics said the cost of fresh vegetables jumped by 24pc compared to a year earlier, fruit rose by 14pc and eggs increased in cost by 12pc. Overall costs of food, tobacco and alcohol climbed by 1.9pc as pork prices fell by a third.
Xi Jinping’s restrictions are also causing supply chains to seize up again and factories to temporarily cut production as lockdowns cause more delays at ports. Factory price growth was also higher than economists predicted with producer costs rising 8pc, a slight cooling from 8.3pc the previous month.
Economists expect the pressures on shoppers to continue building this year but said inflation will not stop Beijing boosting stimulus for its economy.