Japan's reconstruction may increase inflation rates in China

By @ibtimes on

Amid Japanese efforts to support the economy, the nation starts its reconstruction process during the period, which helps the oil, gas and other commodities to rise that fuel China's inflationary pressure to reach to the highest level. Japan's demand for commodities in the aftermath of the recent disasters will add to the already high-level of demand for commodities.

China's consumer inflation rose to 4.9 percent in January and February from 4.6 percent in December. It hit 5.1 percent in November, a 28-month high.

Chinese government aims to face higher inflation rates, through soak up liquidity from the market, where the Central Bank of China (PBOC) raised the required reserve ratios for banks by 50 basis points last week, while it raised the benchmark rates by 50 basis points to 6.0.6% in February.

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