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Economic Indicators

China urges families to keep stocks of daily necessities ahead of winter

By Brenda Goh and Dominique Patton

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China urges families to keep stocks of daily necessities ahead of winter
© Reuters. FILE PHOTO: Two grandmothers with their granddaughter trade vegetables at a market on the outskirts of Shanghai, China June 3, 2021. REUTERS/Aly Song/File Photo

By Brenda Goh and Dominique Patton

SHANGHAI/BEIJING (Reuters) – The Chinese government has told families to keep daily necessities in stock in case of emergencies, after COVID-19 outbreaks and unusually heavy rains that caused a surge in vegetable prices raised concerns about supply shortages.

The directive by the commerce ministry stirred some concern on domestic social media that it may have been triggered by heightened tensions with Taiwan.

In response, the Economic Daily, a Communist Party-backed newspaper, told netizens not to have “too much of an overactive imagination” and that the directive’s purpose was to make sure citizens were not caught off guard if there was a lockdown in their area.

The ministry’s statement late on Monday urged local authorities to do a good job in ensuring supply and stable prices, and to give early warnings of any supply problems.

The central government typically makes extra effort to boost the supply of fresh vegetables and pork in the run-up to China’s most important holiday, the Lunar New Year, which will fall in early February next year.

But this year those efforts have become more urgent after extreme weather in early October destroyed crops in Shandong – the country’s biggest vegetable growing region – and as outbreaks of COVID-19 cases stretching from the northwest to the northeast of the country threaten to disrupt food supplies.

Last week, the prices of cucumbers, spinach and broccoli had more than doubled from early October. Spinach was more expensive than some cuts of pork at 16.67 yuan ($2.60) per kilogramme, according to a vegetable price index in Shouguang, a key trading hub in Shandong.

Although prices have eased in recent days, economists expect a significant year-on-year increase in consumer price inflation for October, the first in five months.

The pandemic has brought an increased focus on food security for Beijing. The government is currently drafting a food security law and has also outlined new efforts to curb food waste after making the problem a priority last year.

The commerce ministry added that local authorities should purchase vegetables that can be stored well in advance and also look to strengthen emergency delivery networks to guarantee smooth and efficient distribution channels.

It added that information related to the prices and supply and demand of commodities should be released in a timely manner to stabilise the public’s expectations.

China also plans to release vegetable reserves “at an appropriate time” to counter rising prices, according to a state TV report late on Monday.

It is not clear which vegetables China holds in reserves and how big those reserves are.

The state planning body has called for the timely replanting of vegetables, urging local governments to support fast-growing produce, according to the report.

Currently China has about 100 million mu (6.7 million hectares) planted with vegetables, the agriculture ministry has said.

($1 = 6.3999 )

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Economic Indicators

Italy says can exceed 3.1% growth target for 2022 despite energy prices

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© Reuters. FILE PHOTO: People walk along the Galleria Vittorio Emanuele II shopping mall in Milan, August 25, 2015. REUTERS/Flavio Lo Scalzo

ROME (Reuters) – Italy’s Treasury said the country’s economy could grow this year by at least as much as Rome’s official target of 3.1% set in April, despite the negative impact of surging energy prices.

Italy grew 0.1% in the first quarter from the previous three months, national statistics bureau ISTAT said last month, revising up a preliminary estimate of a 0.2% contraction.

This left Italy with so-called “carryover” growth of 2.6% this year, assuming gross domestic product was flat in the remaining three quarters, ISTAT said.

Announcing on Monday the bond issuance programme for the third quarter, the Treasury said it expected growth to accelerate in the second quarter, compared with the first three months.

This still makes it plausible to reach or exceed the 2022 growth target of 3.1%, it said in its debt issuance report.

Prime Minister Mario Draghi’s government in April revised down its 2022 economic growth forecast to 3.1% from a 4.7% projection made last September.

The government has budgeted since January more than 33 billion euros ($34.90 billion) to soften the impact of sky-high electricity, gas and petrol costs.

($1 = 0.9456 euros)

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Economic Indicators

French consumer confidence falls more than expected in June

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© Reuters. A woman shops at a fruit and vegetables shop in Paris, France, June 10, 2022. REUTERS/Sarah Meyssonnier

PARIS (Reuters) – French consumer confidence fell more than expected in June, hitting a near nine-year low as concerns about the economic outlook surged in the face of high inflation and political uncertainty, a survey showed on Tuesday.

The INSEE official statistics agency said its consumer confidence index fell to 82 in June from 85 in May and the lowest level since July 2013.

A Reuters poll of 14 economists had an average forecast of 84 with the lowest estimate for 83.

Although households’ concerns about future inflation remained well above the long-term average, they eased in June for the third month in a row.

However, household sentiment about the general economic outlook continued to worsen, falling to the lowest level since May 2020 when France was in the second month of its first and most strict COVID-19 lockdown.

While surging inflation has stressed households in recent months, France’s political situation has added to uncertainty about the economic outlook since President Emmanuel Macron’s party lost its ruling majority in legislative elections this month.

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Economic Indicators

Peru truckers, farmers to strike over fuel and fertilizer costs

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© Reuters. FILE PHOTO: People walk next to parked trucks during a national transportation strike against fuel prices, in Lima, Peru March 18, 2021. REUTERS/Angela Ponce/File Photo

By Marco Aquino

LIMA (Reuters) – Peru’s truckers and some farm groups will go on strike on Monday after failing to reach agreements with the government seeking measures to reduce the impact of steep global price rises of fuel and fertilizer, sector leaders said on Sunday.

Union leaders met on Friday and Saturday with government representatives, with demands including considering freight transport a “public service” that would reduce costs and curb competition from truckers from neighbor countries.

“We are firm in plans to strike with all our bases nationwide,” the leader of the heavy load haulage and drivers union Marlon Milla told radio station RPP. The union has 400,000 cargo transport units in 14 of the 25 regions of the country.

High global fuel prices linked to Russia’s invasion of Ukraine have stoked unrest in Peru, the world’s No. 2 copper producer, while shortages of fertilizer have raised fears over food supply with the government struggling to secure shipments.

The government of leftist President Pedro Castillo, who has seen his popularity tumble since taking office last year, has taken measures to curb the rising cost of living, but the annual inflation rate remains at around 8%, its highest level in 24 years.

Some farming unions also announced strikes on Monday, in protest at the rise in fertilizer prices and shortages.

Latin American leaders are grappling to bring down spiraling prices despite major interest rate hikes. Trucking protests over fuel costs have hit Argentina while Ecuador is being roiled by protests in part linked to gas prices. [L4N2YB27W]

“The dialogue has not been exhausted, we are in a permanent session of ministers to avoid protest,” Justice Minister Félix Chero told reporters on Sunday. The government is offering subsidies for road tolls and fertilizer costs.

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