According to monitoring data of the Ministry of Commerce and the Ministry of Agriculture, since February 2012, the Spring Festival the end of the consumption of agricultural prices began a sustained decline trend is expected that food prices this month the chain will drop slightly, while non-food prices is expected continuation of pre- or slowing down process, and this month CPI hikes significantly from last month, down 1.2 percentage points, our initial judgment that the CPI increase in February 2012 may fall to about 3.2%, compared with the previous month, a large drop in, and will less than 3.5% one-year certificate of deposit, which means continuous 24-month negative interest rates begin to reverse.
The data of the Ministry of Commerce to monitor the consumption prices of agricultural products, wholesale prices of agricultural products for the monitoring of the Ministry of Agriculture and the National Bureau of Statistics monitoring the average price of 50 of the city's main food movements "have shown that after the Spring Festival in February, food prices overall in the process of continued decline in . According to Commerce Department data monitoring, after the end of the Spring Festival holiday, the consumption of agricultural prices began to continued decline in prices of vegetables and other species dropped significantly. We expect that the February food prices rose between-1.2 - 0.8 percentage points. Domestic tobacco and alcohol, and other non-food prices also fell back in view of the end of the Spring Festival holiday, we expect non-food prices rose in February from last month declined slightly, about 1.7%. Accordingly estimates, we forecast the CPI growth between 3% -3.4% in February, taking the median expected February CPI growth of around 3.2% increase over the previous month dropped sharply, and will be less than the current 3.5% one-year deposit rate, which means that since February 2010 has continued for 24 months of negative interest rates begin to reverse.
Last month due to the Spring Festival holiday factors and seasonal factors, the CPI year-on-year increase short-term spikes, but this month the CPI will return to the downstream channel, we maintain that the third quarter of 2012, CPI year on year continued downward in the fourth quarter year on year rebounded to judge the trend is expected that the annual CPI increase in the range of 2.7-3.3%, than last year down significantly. The prices run during the year the biggest uncertainty factor is Iran unrest caused by the fluctuation of international crude oil prices, the recent international crude oil prices have hit a new high of nearly ten months since, continued to rise, likely to lead to a bigger domestic input inflationary pressures, which should be highly concerned.
Year CPI continued downward and the disappearance of the negative interest rates for monetary policy operations space, 2012 years, we maintain the statutory deposit reserve ratio will still be 2-3 times, each time by 0.5 percentage points down in the judgment. Interest rate policy, although the negative interest rates may disappear, but taking into account the medium-and long-term inflationary pressure still exists, although the fall in economic growth is still likely to be more stable in the neutral level of the benchmark interest rate is not necessary to fall, interest rates remain at their current levels more likely. Quantitative tools including deposit prospective rate and open market operations will remain the main policy tool of the future central bank regulation of the market.
