Mainland inflation down but signs of rising pressure

The mainland's inflation rate eased from December's seven-month high to just 2 per cent year on year in January but economists warn of greater inflationary pressure ahead.

According to the National Bureau of Statistics, consumer prices last month were 2 per cent higher than the same period last year and down from 2.5 per cent in December. The figure was in line with market expectations.

However, inflation accelerated on a month-on-month basis at 1 per cent in January, the highest since February last year, mainly due to cold weather that hit food production and increased prices.

"Food prices jumped 2.8 per cent in a month … fresh vegetable prices climbed further in January by 12.7 per cent," senior bureau statistician Yu Qiumei said.

"Constant low temperatures and rain in the south as well as smog in the north and heavy snow in some areas have affected the production and supply of some fresh produce such as vegetables, causing a significant increase in prices," Yu said, adding that vegetable prices have risen 37 per cent since October.

Yu said the government was aware of the fluctuation in food prices and had imposed measures to ensure stable supply.