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Inflationary pressures to build

Published 11 Dec 2009

With the consumer price index up 0.6% in November year on year - the first CPI increase in nine months - inflationary pressures look set to intensify, along with the liklihood of policy responses over the next two quarters.

Consumer price inflation returned to China in November, with food price inflation showing a marked increase. We reaffirm our call (CC July 9 2009 Big Call) that inflationary pressures are set to intensify in Q1 2010. The likelihood of policy responses over the next two quarters is growing.