China CPI Comes At 4.9%, Below Consensus Of 5.4%, In Line With Zero Hedge "Pervasive Data Manipulation" Expectations

Tyler Durden's picture

The consensus expectation for Chinese CPI was 5.4%. Zero Hedge's expectation based on just announced manipulated CPI data was 4.9%. Guess who was correct... In the meantime, Chinese food prices are not increasing by 5% every ten days, or over 400% annualized. Or at least, they are not doing so on rice (most likely fake) paper.

From Bloomberg:

China’s inflation was less than economists estimated in January after the statistics bureau cut the weighting of food in the consumer-price index.

Consumer prices rose 4.9 percent last month from a year earlier, the statistics bureau said in a statement on its website today. That compared with a 4.6 percent gain in December and the median forecast of 5.4 percent in a Bloomberg News survey of 27 economists. Producer-price inflation accelerated to 6.6 percent from 5.9 percent in December.

A drought in wheat-growing regions, rising global commodity prices and a 53 percent increase in money supply in two years are adding to price pressures in the fastest-growing major economy. Officials may front load policy tightening in the first half of the year as inflation remains elevated, according to economists from JPMorgan Chase & Co. and Morgan Stanley.

“The combination of rising inflationary pressure and robust economic growth makes further tightening inevitable,” Shen Jianguang, a Hong Kong-based economist at Mizuho Securities Asia Ltd., said before today’s release. He expects at least two more interest-rate increases before the end of June.

The Shanghai Composite Index rose 0.4 percent as of 10:15 a.m. local time
Changes to Index

Statistics bureau spokesman Sheng Laiyun said in October that new weightings for the consumer price index would take effect in January. Food previously accounted for a third of the basket of goods that make up the index and was the main driver of inflation last year. Deutsche Bank AG economist Ma Jun said yesterday any slowdown in consumer-price gains may only reflect a reweighting.

January’s inflation data reflects a “more thorough” change in the weightings of the index made every five years, the China Securities Journal reported today, citing an unidentified statists bureau official.

Asian economies, with food costs and inflows of capital driving inflation, may need to raise interest rates further to limit the risk of overheating and prevent a “hard landing,” International Monetary Fund Managing Director Dominique Strauss- Kahn said Feb. 1. India’s benchmark wholesale-price index rose 8.23 percent in January, Indonesia’s inflation is 7 percent and South Korea’s is 4.1 percent according to the latest government data.

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Mr Lennon Hendrix's picture


The Graduate "One Word: Plastics":

Mr Lennon Hendrix's picture

It is ironic that plastic rice is cheaper than real rice when peak oil production is looming.  Instead of burning Picassos for heat, we eat them.

You would rather a club quote perhaps....

Tyler checks his watch....

It's getting exciting now.

william the bastard's picture

Bottled water has cost more than gasoline for over 10 years now.

"Is that your blood?"


Cleanclog's picture

No inflation!  Back up the truck and buy them up. And here is the heralded sputnik moment - - - moon shot!!!!

Yen Cross's picture

 Nice call on that one. And the teflon Aussie is on the bid anyways. Even after a fairly dovish RBA statement.

Notimpossible's picture

PPI blowing past expectations, 6.6% vs. 6.1%. Nice spread on the PPI/CPI...should keep the veil over the masses...number one rule of plutocracy (ahem Egypt!) keep the masses sedated

Hedge Jobs's picture

Yeah PPI a shocker at 6.6 (5.9 prior). Not good news for chinesse companies. Im sure Hu is on the phone to the chairsatan right now asking for advice on how to strip out commodity prices from the PPI.



Maiden Lane's picture

Well, I for one am glad everything is alright!

alien-IQ's picture

Remember when CNBC used to provide the kind of relevant data and insight ZH does?.....

.....Neither do I.

william the bastard's picture

Where o where is Ted Davis this valentines night?

whatsinaname's picture

And now Brent and WTI ramp up on such good news.

That oughta be good news for FDX.

Boilermaker's picture

I'm in Beijing on Friday, Nanjing on Saturday, and Wuxi on Monday.

I'll report back the price of deep-fried sewer rat when I get back!

Maiden Lane's picture

Mubarak in a coma!!! that was fast

sabra1's picture

no, he was placed in suspended animation, so that the next generation of egyptians, would re-elect him as pharoah once again!

eigenvalue's picture

Go long agricultural products, especially wheat, corn and soya bean. I pray every night that the current drought in China would devastate all the winter wheat crop! Screw the Chinese!

tmosley's picture

Be careful what you wish for.  Suffering is a contagion that crosses oceans overnight.

william the bastard's picture

Quintus Horatius? Oh!..not

.. it's tmoselry know it all. He must be quoting Jefferson Davis "Boss" Hogg. West Okey shack dwelling  unpaid gold pimp doomer

Terminus C's picture

Fuck man... you wish mass starvation on a people because... why exactly?  If you have issue with the government of China, they will not be affected by the loss of food.

A) you are a heartless piece of shit


B) you are a dumb fucking kid who knows not what you are wishing for.

eigenvalue's picture

Only a famine will wake the Chinese up and get rid of the current regime. Almost every countrywide uprising in the Chinese history started with a big famine. 

Terminus C's picture

And what, exactly, do you think will replace the current regime?  The death of millions will bring about a harsher, more controlling, more sociopathic government.  That is the history of China.


fajensen's picture


C) the fallout will destroy the oligharchs here ...

chump666's picture

and PPI came in strong China is trying that Goldilocks crap the US tried to pull in 2007, before the economy imploded.

everyone in the universe knows china manipulates every data that comes out

China is c-hair away from hyperinflation.

You wanna make a bet zero hedge, bet China tightens like mad coming quarter, and sells a shit load of UST's and Shanighai short's on.  A better bet, will send the global economy into a ice-age, say 6mths long.  Till maniacal Bernanke buys another 600billion.

As for the AUD, blame the lazy banks sitting on long carry trade plays, rejoice when they get crunched on a HFT short sell

system failure's picture

It matters not what they report any more or any government for that concern....

What matters is whether I can afford what I need to survive.

Life of luxury items will not exist, as the need to exist with even less becomes life.


william the bastard's picture

Sticking feathers up your butt does not make you a chicken.


Tyler Durden

SHRAGS's picture

Thursday, 15 March 2007, 10:24

EO 12958 DECL: 03/15/2032
Classified By: Ambassador Clark T. Randt, Jr. Reasons 1.4 (b) and (d).

4. (C) GDP figures are "man-made" and therefore unreliable, Li said. When evaluating Liaoning's economy, he focuses on three figures: 1) electricity consumption, which was up 10 percent in Liaoning last year; 2) volume of rail cargo, which is fairly accurate because fees are charged for each unit of weight; and 3) amount of loans disbursed, which also tends to be accurate given the interest fees charged. By looking at these three figures, Li said he can measure with relative accuracy the speed of economic growth. All other figures, especially GDP statistics, are "for reference only," he said smiling.


London Banker's picture

Well done on the forecast, Tyler!  Impressive.

Good Michael Pettis piece on the Japanification of the Chinese economy, where holding down wages and subsidies to investment lead to long term deflationary disaster.



meizu's picture

why does everyone compare china to Japan?  Just bcause they are both east asian doesn't mean their economies will follow the same path.  The country that should be compared to Japan is United States, which is about to experience deflationary disaster.

Boilermaker's picture

It's all Oriental isn't it?  What's the difference?  Rugs, rice, noodles...shit, man, I can't even tell the difference.

dcb's picture


they will not let america go into deflation. period.

haven't ypu learned anything. any hint of prices falling will be met by anther qe. everytime asset prices fall they used to have a rate cut, since they can't now it means another qe.

chump666's picture

..they cut food weighted!?? 

As if the market is gonna buy that BS!  I'll bet the 5yr CDS is blowing out for China.

Big tightening ahead, send a ton of inflation back to the US.

tickhound's picture

I don't eat chinese food

Notimpossible's picture

February 15, 2011

Stocks hit three year high on bigger than expected US fiscal deficit and Chinese inflation only coming in at 5%

New York - The S&P 500 got a lift from expectations that FedEx lowered forecast due to weather will accelerate second quarter earnings as spending and business resumes postponement. Copper hit and all time new high as Chinese demand should accelerate on better than expected inflation data. Joe Smith from Deutsche Bank says "lower than expected Chinese inflation should open the door to more dovish comments from the PBoC"...


Notimpossible's picture

Consumer stocks were the best performing sub-index in the S&P 500 Index, as credit card companies announced that they were increasing credit limits by two fold to keep up with the economic momentum. Billy Watson from LA was quoted as saying "great news on the credit limit, I almost had live within my means and sell my ipad"

billwilson's picture

MUST keep CPI number UNDER 5%!


Mission Accomplished.

Boilermaker's picture


I wonder if they'll catch on?

jobs1234's picture

Does this mean I should BTFD?

Misean's picture

Well that's a relief. I'll just pop on down to the corner rice vendor and show them the headline. Be eating good tonight!

mynhair's picture

Eat better tomorrow, play AVL.

Top 8.33 (in pre-market 2 weeks ago), bottom 7.02 (set last week).

8.10 to 7.51 today range.  BooYah, you Cramer ass!

It's new, has no charts, BTW.

mynhair's picture

Kewl, rally on!

(Excuse me while I puke -again.)

buzzsaw99's picture

Confucius say:

Statistician who lie like dog wake up with fleas.

Statistician who fart in church sit in pew.

Statistician who shave inflation lose face.

mynhair's picture

That was Cornfucious that said that, not to be technical....

buzzsaw99's picture

buzzsaw99 say: mynhair who squawk like dodo wind up with egg on face.

cornholio say: i need tp for my bunghole.

Scritchy's picture

Buzz, I for one really like those sayings and got a kick out of them.

But then again, I really like to fart in a space suit.  :)


buzzsaw99's picture

Scritchy who cut cheese in suit make own eyes water.

Scritchy who cut cheese with mynhair in suit make nacho cat.