China's consumer price index (CPI), a measure of inflation, was up 8.3 percent in March of this year, as against 8.7 percent a month ago.
Li Xiaochao, spokesperson of the National Bureau of Statistics (NBS) of China, said Wednesday the country's CPI for the first quarter of this year was 8 percent.
In the January-March period, the inflation indicator rose 7.8 percent for urban areas, and up 8.7 percent for rural areas.
In breakdowns, food prices soared 21.0 percent, driving CPI up by 6.8 percentage points. Housing prices and rents went up 6.6 percent on average, driving up the inflation gauge by one percentage point.
The first quarter also saw retail prices up 7.4 percent, 5.3 percentage points higher than the year-earlier level, and producer price index, or PPI, up 6.9 percent, 4.0 percentage points higher.
Prices of raw materials, fuels and power supply increased 9.8 percent in the first three months of this year, 5.7 percentage points higher than the level for the same period of last year. Meanwhile, housing prices in 70 major cities rose 11 percent on average, 5.4 percentage points higher.
According to the NBS, the inflation indicator rose 7.1 percent in January and went up to a nearly 12-year-high of 8.7 percent in February, which was partly the result of severe winter weather that disrupted many businesses and activities. It is believed that food prices contributed significantly to the rising CPI, as they make up about 33 percent of the inflation index.
Liu Shiyu, the deputy governor of the People's Bank of China, the central bank, said earlier that inflationary pressure remained strong in March, although prices were not as much affected as in February by severe winter weather and the Lunar New Year.
A report by the Bank of China (BOC), a state-owned commercial bank, said that pricing pressures were likely to persist during the first half. Consumer prices could jump 8 percent as a result of higher factory-gate prices and higher international prices for crude oil and food, the report said.
Tan Yaling, a specialist on the financial industry, said that as a major world trade participant, China has seen its links to international markets grow rapidly.
The BOC report said that rising inflationary pressure wasn't coming only from higher food prices, as many people believed, but was also closely linked to excessive money supply.
Zhu Baoliang, an economist with the State Information Center, said hot money inflows had added to China's money supply, which also gave rise to inflationary pressure.
According to Zhu, more than 80 billion U.S. dollars in speculative funds moved into China in the first quarter, against 120 billion U.S. dollars in all of last year.
Moreover, the lingering effects of price rises in 2007 contributed to inflation in the first quarter of this year, said Xu Lianzhong, an official with the price monitoring center under the National Development and Reform Commission.
(Xinhua News Agency April 16, 2008)