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China inflation hits 11-year high China inflation hits 11-year high
(40 minutes later)
China's inflation hit 7.1% in January, the highest rate for more than 11 years, official figures show. Chinese inflation hit an 11-year high in January after rising price pressures were exaggerated by fierce snow storms, official figures show.
The rise in consumer prices was driven by an 18.2% increase in food costs over the same period a year ago, the National Bureau of Statistics reported. Soaring food prices were largely blamed for pushing consumer inflation up to 7.1% last month, from 6.5% in December.
Inflation in China continues to rise despite measures by the country's leadership, which hopes to keep a lid on the cost of food in particular. Inflation in China continues to rise despite higher interest rates and other measures by Beijing to keep the economy from overheating.
Rising food costs have been blamed on the harshest winter for decades. The worst winter for decades hit food supplies, sending food costs up 18%.
Massive snowfalls wrecked crops and killed millions of livestock.Massive snowfalls wrecked crops and killed millions of livestock.
But analysts caution that the severe weather is not the only factor behind rising food costs, and warn further increases are likely to be ahead. But analysts cautioned that the severe weather was not the only factor behind rising food costs, and warned that prices could still increase further.
UnrestUnrest
The January rate of 7.1% was up from 6.5% in December - and was the highest figure since September 1996, when consumer prices rose 7.4%. January's inflation rate of 7.1% was the highest figure since September 1996, when consumer price inflation hit 7.4%.
Non-food inflation only crept up in January, rising 1.5% over a year beforehand, the official figures showed. Non-food inflation rose only slowly, hitting an annual rate of 1.5%, the figures showed.
The rise in food costs poses a problem for leaders in a country where such rises are historically linked to social unrest, say correspondents. Chinese leaders have been under pressure to control spiralling food costs, the biggest factor behind historical periods of social unrest in a country where according to the World Bank 300 million people live in poverty.
Measures taken by the government include giving farmers incentives to rear more pigs.Measures taken by the government include giving farmers incentives to rear more pigs.
Last year, the government also raised interest rates six times in a bid to keep inflation under control. Last year, the government also raised interest rates six times in an attempt to keep inflation under control.
Analysts said in light of the latest figures they expected the government to continue with a tight monetary policy. Analysts said in light of the latest figures they expected further interest rate rises.