China’s inflation has surged in recent days, driven by a sharp increase in demand for goods and services during the Lunar New Year celebrations. The country’s consumer price index (CPI) jumped to 2.4% in the first week of February, exceeding market expectations. This acceleration in inflation is largely attributed to the surge in domestic demand, which has been fueled by government policies aimed at boosting economic growth.
Economists point out that the increase in prices can be seen as a positive sign for China’s economy, as it indicates a strengthening domestic consumption sector. However, concerns remain over the potential impact on inflation and interest rates. The People’s Bank of China is closely monitoring the situation, and analysts expect the central bank to take corrective measures to curb rising prices.
The Lunar New Year celebrations typically bring significant spikes in demand for goods and services, from food and decorations to travel and entertainment. This surge in domestic demand can have a lasting impact on inflation, which can be seen as a reflection of China’s economic health.
Source: https://www.ft.com/content/517fee86-195e-43f8-bed6-12d3fd3fc7b8