Goldman raises 2008 inflation forecast
27 February 2008
Goldman Sachs has lifted its China inflation forecast for 2008 to 6.8% from 4.5%, state media reported. People's Bank of China (PBOC) earlier announced that M2, a broad measure of total money supply, had risen 18.94% in January from a year earlier and was up 2.2% from the previous month. Inflation worries were also stoked by a PBOC announcement on Tuesday that China's Corporate Goods Price (CGP) index rose 1.1% over the previous month in January, an 8.4% rise year-on-year. The CGP index reflects price changes of products traded among corporations and traces overall price fluctuations. PBOC has said it will persevere with its tight monetary policy this year to hold off inflation.