Ex-PBOC Adviser Li: China Inflation Likely To Ease To 2%-3% In May-August
First Published Sunday, 29th April 2012 02:37 am - © 2012 Dow Jones
SHANGHAI -(Dow Jones)- China's inflation will likely ease to 2%-3% between May and August, and the full-year 2012 inflation will likely fall to around 3.1% given a slowdown in domestic economy, a former adviser to the People's Bank of China said on Sunday.
"Inflation is unlikely to be a major concern this year," said former central bank adviser Li Daokui, who left his position in March, without elaborating.
China's consumer price index rose 3.6% in March from a year earlier, quicker than February's 3.2% rise. In 2011, the CPI rose 5.4%.
The slower economic growth in the first quarter deserves concerns despite signs of stabilizing, and Beijing should make appropriate adjustments in its macro-control policy, Li said.
China's gross domestic product grew 8.1% in the first quarter from the same period a year earlier, expanding at its slowest pace since the first quarter of 2009. GDP growth slowed from the 8.9% rise in the fourth quarter last year.
The authorities should push forward the trial tax reform that replaces business tax with value-added tax this year and carry out more fine-tuning measures in fiscal policy, he added.
He also said that the International Monetary Fund hasn't paid enough attention to China's shrinking "twin surpluses" in current and capital accounts, which indicates that China has started its economic transition, Li said.