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May CPI prospect heralds another rates hike

By Ben Yue (chinadaily.com.cn)
Updated: 2011-06-01 13:49

Analysts believe China's inflation in May may reach 5.4 percent growth due to the increasing price of food, China Securities Journal reported on Wednesday. Some also predict a hike in interest rates in June.

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A report by China International Capital Corporation Ltd attributes the recent jump in the price of pork and water products to the drought in some southern provinces, which may take inflation to its highest point this year.

Fan Jianping, director of the State Information Center's economic forecasting department, said the highest CPI figure of 2011 may show up during the second quarter. He said he expects it will decrease in the second half of the year.

Experts said China's central bank may raise interest rates again in June to curb the high inflation，according to the newspaper.