China's National Development and Reform Commission (NDRC), the country's top economic planner, Friday said in a statement that it will fine consumer product giant Unilever Plc US$2 million over its high-profile dissemination of possible price hikes in the country.
According to the NDRC, the public comments by Unilever in April about possible price increases had "intensified price hike expectations among consumers", "led to panic buying", and "seriously distorted market order".
In March, Unilever issued price increase notice to supermarkets in China, saying the company plans to raise the prices of some of its products. Later, Unilever's spokesman Zeng Xiwen said in a number of interviews with major domestic media that the company will increase prices because of surging raw material costs. These comments have violated China's pricing regulations, said the NDRC.
China's inflation rate soared to 5.4 percent in March, a new high in 32 months. Curbing inflation has become the country's top agenda. The National Bureau of Statistics will release the consumer price index (CPI) for April next week. Analysts believe April's CPI will reach a new historic high.
Since March, the NDRC have brought in representatives from consumer product companies including Unilever, Procter & Gamble Co. and Master Kong, and asked them to put off their planned price hikes.