The causes of inflation in China:
First, natural disasters are frequent. 20 10 agricultural products in China generally failed to harvest, which led to a rapid increase in prices. In 20 10, some countries suffered from drought and flood disasters, resulting in reduced grain production. Therefore, the rise in international agricultural prices has had a great impact on domestic prices in China.
Second, there is excess liquidity. Due to the economic stimulus policy implemented by China after the financial tsunami on Wall Street in the United States, too much money was issued and circulated in the market.
Third, at 20 10, China adjusted its price, which further aggravated inflation.
Fourth, China's market economy is not standardized. After the central government regulated the real estate, many hot money in the society withdrew from the property market and made serious speculation on agricultural products.
Fifth, the prices of domestic production factors have risen. Cost factors lead to rising prices and push up inflation.
Sixth, the outflow of labor has affected agricultural production, leading to a rapid rise in agricultural product prices.
Seventh, the growth of per capita income has continuously improved the per capita food consumption level, leading to the widening gap between food supply and demand. In the long run, the pressure of price increase driven by food demand will often be very serious.
Eighth, the consumption scale of various bulk products in China is constantly expanding. The price of international primary products will rise sharply.
Ninth, at the beginning of 20 10 1 10, the liquidity released by the new round of quantitative easing policy adopted by the United States made the prices of domestic and foreign agricultural products, commodities and raw materials rise, which made the CPI growth rate in 20 10 exceed expectations.
Tenth, the material industry is constantly shifting to developing countries, and the trade deficit with developing countries is constantly expanding, thus forming inflation driven by external demand and leading to an increase in commodity prices and production factor prices.
Twelfth, after the developed countries transferred the materials industry to developing China countries, a large amount of funds were transferred to the futures market, which greatly promoted the prices of various futures. China is facing long-term imported inflation.
Of course, the unbalanced exchange rate, the influx of hot money into China for speculation, and the massive investment in money will lead to excessive money supply and great liquidity, which will also lead to inflation.
Solution: solve it through monetary policy or fiscal policy. In monetary policy, we can raise the statutory deposit reserve ratio, raise interest rates and issue treasury bonds. Fiscal policy: reduce taxes and increase financial allocation.
At the same time, strengthen capital flow, hot money flow, market supervision and other measures to solve it.