Home >

Goldman Sachs: Policy Continues To Shrink &Nbsp; Inflation Remains High Risk Reduction

2010/12/13 17:31:00 58

In December 13th,

Goldman Sachs

The research report indicates that the government will continue to adopt a package of policy measures to curb inflation in the next few weeks or months.

The government has the ability to control inflation and is highly concerned about it.

Inflation rate

In the next few quarters or even longer time, the risk of continued high stays is very low.

Statistics Bureau

Released data show that CPI continued to rise in November, an increase of 5.1% over the same period last year.

The report says that the government has the ability to control inflation under any circumstances.

Since the policy is lagging behind, and despite the obvious reduction in the lag time in recent quarters, if any regulation is enough, it can solve the inflation problem.

A series of measures, including the increase in the reserve ratio, indicate that the government has been very concerned about inflation. The risk of inflation persisting in the next few quarters or even longer is low.

According to the report, "although food prices have dropped in recent weeks, the government still needs and will further tighten policy.

It is expected that the government will continue to adopt a package of policy measures, including further raising the reserve ratio, raising interest rates, window guidance, speeding up the appreciation of the renminbi against the US dollar, and adopting other micro control measures such as price fixing (which is usually achieved through indirect guidance meetings) and the release of food reserves.

The specific magnitude and frequency will depend on the performance of the data.

On the evening of December 10th, the central bank announced a 0.5 percentage point increase in the deposit reserve ratio.

In response, the report pointed out that the credit data in November highlighted the need for further tightening of policy: not only the supply of money and credit continued to be strong, but also the growth of domestic demand which was already very strong, and the growth of external demand was also accelerating.

Although food prices and vegetable prices have continued to fall in recent weeks, the further acceleration of aggregate demand growth may increase inflationary pressures on the underlying surface, and tightening measures will continue.

In addition, the report also stated that "in view of the fact that the government's response to the changes in the economic situation has become more rapid in the past two years, and at the same time, it has become more aware than ever that inflation is ultimately a monetary phenomenon. Next year, the growth rate of inflation will tend downward to normal level next year, thus maintaining a forecast of CPI growth of 4.3% over the same period in 2011."

On the 10 day, the central bank released the credit data in November, added RMB 564 billion yuan in November, and RMB 7 trillion and 450 billion yuan in November.