Inflation in China Eases

123jump.com Staff
10 Feb, 2009
New York City

Consumer price index in China eased 1% in January from the same period a year ago and increased 0.9% from December. China Southern Airlines fell 1.5% to HK$1.36 after saying it plans to issue Rmb2.3 billion worth of A shares at Rmb3.16 per share and $148 million worth of H shares at Rmb1 per share.

[R]6:00AM New York, 6:00PM Hong Kong - China consumer price index eases 1% in January.[/R]

Hong Kong stocks rose led by financial stocks on expectations that Beijing will slash interest rates to boost growth.

In Hong Kong trading Hang Seng Index gained 0.8% or 111.58 to 13,880.64, and the China Enterprises Index of Hong Kong listed mainland shares, or H shares, advanced 0.8% or 60.11 to 7,814.68. In Shanghai trading CSI 300 index edged up 1.3% or 30.08 to 2,326.76.

Daily turnover on main-board dropped to HK$42.1 billion from HK$48.5 billion yesterday.

China''s Consumer Price Index Eases 1% in January

National Bureau of Statistics reported today that China''s consumer price index eased 1% in January from the same period a year ago and increased 0.9% from December, as prices in the urban areas and rural areas increased 0.7% and 1.5%, respectively.

The price of foodstuffs and consumables increased 4.2% and 1.5%, while the price of non-foodstuff and services dropped 0.6% and 0.8%, respectively.

In the foodstuff category, the price of meat, poultry and its processed products declined 2.8% and vegetable, grain, aquatic products, fresh eggs, and spices advanced 19.6%, 3.9%, 11.6%, 1.3% and 5.6% in that order.

Oil and fats shed 13.9% and fresh fruits lost 0.4%.

Transportation and communication fell 2.5% from the previous month.

China Says no to Trade Protectionism

Xinhua News Agency reported that Vice Commerce Minister Jiang Zengwei China will not resort to trade protectionism in order to stimulate economic growth.

The U.S. Senate last week maintained a provision to allow the use of US made iron and steel in all public works program.

""We should not only oppose trade protectionism in other countries but also support trade ourselves,"" said Zhang.

Gainers & Losers

Hong Kong stocks rose 0.8% after the country''s consumer prices index eased to 1% in January raising expectations that Beijing will lower its interest rate in order to boost economic growth.

However market watchers forecast the interest rate reduction will be lower than previously projected.

Financial stocks increased after Reuters reported that lending at Chinese banks is estimated to have advanced to Rmb1.6 trillion. ICBC jumped 1.1%, China Construction Bank soared 1.9%.

Petrochina rose 3%.

China Southern Airlines fell 1.5% to HK$1.36 after saying it plans to issue Rmb2.3 billion worth of A shares at Rmb3.16 per share and $148 million worth of H shares at Rmb1 per share.

Hang Lung Properties dropped 1.3% on worries over continued decline in house prices.