(Yicai Global) Feb. 7 -- China’s consumer inflation will continue to increase moderately as there is a solid foundation for prices to remain stable, while factory gate prices should fall, the country’s macroeconomic planner said yesterday.

This year, the Covid-19 pandemic is likely to have less of an impact and prices should depend more on domestic economic factors, the National Development and Reform Commission said. Although high global inflation may continue for some time, with the shift in monetary policy in major economies and the narrowing gap between supply and demand, inflationary pressure should weaken, it added.

The consumer price index, a key gauge of inflation, gained 0.9 percent last year from the year before, well below the 2.5 percent clip logged the year before. The producer price index, a measure of industrial profitability, though, soared 8.1 percent on the surging price of raw materials, supply shortages and high liquidity levels. It fell 1.8 percent in 2020.

Domestically, there will be abundant supplies of industrial and agricultural products, including basic necessities such as grains, oil, meat, eggs, milk, fruits and vegetables, the NDRC said. The government will ensure adequate supply of fuels including coal, oil and gas to help businesses deal with abnormal fluctuations in market prices.

Editor: Kim Taylor