China attempts to curb price hikes on key commodities in the run up to National Day, according to a series of notices issued by the National Development and Reform Commission (NDRC) in August.

To ensure the basic needs of the masses, local pricing authorities have been ordered to stabilize key commodity prices to "create a harmonious and stable price environment" before the 60th anniversary of China's founding on October 1, said a statement Thursday.

"Supervision and inspection on the prices of food, liquid gas, tickets to tourist spots, transportation, parking fees and other major commodities closely related to people's life, should be strengthened," it said.

Any illegal acts of stock-piling liquid gas, "pushing up or generally cheating over prices," will be dealt with according to law, said the statement.
The notice claimed that price hikes "would not emerge as China has maintained a balance between supply and demand, since it has solid grain reserves and competitive consumer markets".

It also said the recent price rise in a few commodities and the high expectations of inflation was fueled by the rapid credit growth and the rebound of stock and real estate markets.

There has been no price raise announced as expected last Wednesday, when the average crude oil prices in Brent, Cinta and Dubai rose by an accumulative 11.14 percent over 22 continuous working days, according to CBI China. Since May 7, China's oil products' pricing mechanism ensures fuel prices should be adjusted when the average crude oil prices in Brent, Cinta and Dubai change by 4 percent over 22 continuous working days.
During this crucial time when the industrial economy is rallying and the prices of agricultural products rising, the market is very sensitive to price adjustments, an official from NDRC told Shanghai Securities News on Friday.

"The NDRC will try to reduce the frequency of oil price adjustments, which does not violate the principle of the existing pricing mechanism," he added. He also said frequent oil price changes to keep up with international prices will not only increase unnecessary expense for consumers, but also add uncertainty to the macro economy.

Source:Global Times