china inflation – ft article

Sounds like the ‘managing expectations’ they teach at the western universities.

Inflation is under control, says Chinese regulator

By Jamil Anderlini

December 17 (FT) — “The recent inflation is completely different from the periods of very high inflation that China has encountered in the past,” Mr Liu, chairman of the China Banking Regulatory Commission, said on Friday.

“There is overcapacity for most industrial goods in the Chinese market and it’s impossible for upstream inflation to be transmitted downstream.”

The relatively sanguine assessment also partly explains why Beijing appears set to grant Chinese banks a lending quota next year that is roughly the same as this year’s, or even slightly higher, even though the economy is already awash with liquidity.

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