China's February inflation figure increased 8.7 per cent year on year, not far from doubling up on the 2008 average target set by the government of 4.8 per cent.
The new inflation figure is the highest since 1996. Some analysts
are calling for steep interest rate hikes of two to three percentage points
to try and halt ongoing inflation growth, Bloomberg reports - although
frequent rate rises and several increases in bank reserve ratios during
2007 have already failed to check price rises.
Earlier this week, the National Bureau of Statistics said producer prices, the actual cost of goods when they leave factories,
rose 6.6 per cent year on year in February. This is the highest increase since 2004.
Producer prices are a main key inflation indicator.
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