Inflation in China has become a very serious problem despite the moderate official numbers, according to an article by Shanghai Business Daily. The official CPI released in April was at 2.8%, showing a mild upward trajectory. However, the paper reports, "the true inflation level has by far exceeded what the CPI reflects. If one takes into consideration various economic inflationary indicators or listens to the experiences of everyday people, the real inflation level has reached serious proportions.” If the government applies macro controls this year, the economy will come to a standstill, but without such control there could be chaos, says the article.
Source: Shanghai Business Daily reprinted by Nanfang Daily, May 13, 2010