Just when Shenzhen had been thinking it had inflation under control, along came the coronavirus known as COVID-19. January CPI data released today shows stockpiling due to fears about the virus had already had an impact in late January as CPI surged 6.7% YoY, up 1.8 points from December’s 4.9%.
This resulted in a 2.2% monthly jump in CPI, following a 0.2% MoM decline registered in December. The previous months had seen pork prices take off due to cuts imposed on herds nationwide as a result of a deadly swine flu, and this had created a knock-on effect on other livestock prices, but December data had indicated they were starting to ease.
Not any more. Food prices rose 24.4% YoY in January, led by livestock, which nearly doubled at 83.1%, while vegetables rose 16.4%.
The Shenzhen office of the National Statistics Bureau explained that this was probably because many Shenzhen residents had decided to skip their traditional Chinese New Year holidays (which had started on January 24) and stayed home. This had led to the “double whammy” of surging demand and labor shortages at vegetable production bases, according to Shenzhen Economic Daily.
Non-food prices rose only 2.5% YoY, with service prices and consumer good prices rising by 2.5% and 9.4%, respectively.
The Producer Price Index (PPI) in Shenzhen slightly dropped by 0.1% year-on-year, remaining unchanged compared with December.