Signaling a move out of deflation, China’s consumer price index in November climbed 0.6% from a year earlier. This comes in tandem with the decision by China’s government, which had held prices for materials at superficially low levels, to allow them to rise and to begin introducing market competition in several key resource sectors.
Peng Sen, vice minister of China’s National Development and Reform Commission, said at a recent meeting the country is actively working to reform its resources pricing system. This move is part of a government push to achieve “more efficiency in industry,” says Rosealea Yao, research manager for Dragonomics Research & Advisory, Beijing. “It will help bring in excess capacity.”