Energy prices increased 23.1% year-on-year. This was partly due to a rise in gasoline prices, which were up 32% in January compared to the year-ago level. Gas prices are on track to post similar gains this month, Fan said, as oil prices remain above $90 a barrel.
As per the note, inflation in January was just 3.5%, excluding food and energy prices.
Annual gains in the Consumer Price Index account for more than half of the January headline year-on-year CPI, with gas prices rising, as well as further gains in home purchase costs and vehicle purchase/rental prices. Gain is responsible.
Strong consumer demand, as well as warm housing and energy markets, are projected to keep inflation at bay in near-term readings. Demand for tangible goods has been particularly strong, with goods inflation at 7.2% year-on-year in January, compared to a more modest, though still high, 3.4% for services.
Due to strong market prospects of labor and increased savings, families will have enough purchasing power for both in future. The easing of virus-containment rules will help drive demand for hotels and travel services even further.
