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As Chinese Beer Prices Surge, Cpi Is Set To Pass 6%; Here Comes Shrinkage

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http://www.zerohedge.com/article/chinese-beer-prices-surge-cpi-set-pass-6-here-comes-shrinkage

Yesterday we reported that China just hiked its fuel prices for only the second time in 2011. Now, again courtesy of Business China, we find that something far more important to the Chinese population is about to surge in price: beer. "The National Development and Reform Commission (NDRC), China’s top economic planner, has hauled in representatives from China’s four largest beer makers (China Resources Snow Breweries Co. Ltd., Tsingtao Brewery Co. Ltd., Beijing Yanjing Brewery Co. Ltd. and the China unit of Belgian Anheuser-Busch InBev NV ) for talks over their price hikes, as it looks to tackle public concerns over soaring inflation. " Since February, the cost of beer production has risen by RMB 94 per ton, which explains the beer makers’ unanimous price hikes,” the person said. Since January, CR Snow Breweries, China’s largest brewer by volume, has raised prices by more than 10% in Sichuan, Liaoning and Anhui provinces, where it enjoys a dominant position in the market. Tsingtao Brewery also hiked prices of several products in the following months by an average of 10%, the company announced earlier." This follows news from the China Securities Journal that Chinese CPI, which recently dipped again below 5%, is about to have a breakaway month in March. "Chinese consumer prices are likely to rise more than 5% year-on-year in each month in the second quarter and the inflation rate may even surpass 6% in some months, the official China Securities Journal warned in a front page editorial published Wednesday." And while energy is energy is a major component of Chinese CPI, it is food that is the main variable: as was discussed previously on Zero Hedge, whereas food is merely 7.8% of total CPI, in China it is about 30% (this is before the recent CPI weighting adjustment). Which means a desperate China is now forced to resort to that ultimately last ditch attempt at covering surging prices- Shrinkage "Resigned to rising raw materials prices, brewers are figuring out new ways to offset higher costs. “One way of countering the costs is to reduce beer capacity by as much as 100 milliliters for a 660-ml bottle,” said the head of a local beer company." Surely, the dumb local peasantry will never figure this cheap trick out.

Bernanke will be raising a glass to this tonight.

Inflation is out of control in the Chinese command economy.

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They are out of control too in the British command economy.

true, but no-one really cares about the British economy apart perhaps for the few British tax payers (less than 10 millions?), so an absolute minority...

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Inflation in China is dangerous for the CCP

Last time inflation was uber high you got people this happened:

While in the UK inflation can be uber high and all that will happen is HPCers will be a bit annoyed. You reckon you'd stand in front of a tank?

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Inflation in China is dangerous for the CCP

Last time inflation was uber high you got people this happened:

While in the UK inflation can be uber high and all that will happen is HPCers will be a bit annoyed. You reckon you'd stand in front of a tank?

Unlikely in the UK. The government will commission another series of X-Factor

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While in the UK inflation can be uber high and all that will happen is HPCers will be a bit annoyed. You reckon you'd stand in front of a tank?

Yes as it would probably be windy and the wrong type of leaves would land in front of it making it useless.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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