The indicator monitors retail price changes for goods and services included into the consumer goods basket. The index calculation includes food and clothing prices, education expenditures, as well as prices for public health services, transportation, utility payments and leisure. The index is a monthly calculated value and is the basic indicator of the inflation rate in any country including China.
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Considering the importance of China’s economy for the global economy, the index significantly influences the markets, including foreign exchange market.
Whenever China’s inflation grows, the chances of the Governmental measures of “cooling down” the na-tional economy are increased. It brings pressure on the world stock markets, pushes down the high-yield currencies demand and raises the demand on safe haven status currencies, such as Dollar, Yen, Swiss franc.