Different from western central bankers, the central bank of China believes that the coming inflation wave is not “transitory” and that a major component of the trigger, namely commodity price increases, is the expansive monetary policy that has fed financial speculation.
In its Q1 report on monetary policy implementation, the People’s Bank of China comments on the surge in global commodity prices, noticing that as of the end of April three major composite indexes, the WTI crude oil future price, the LMW copper future price and the CRN commodity spot price index have risen by 187 percent, 89 percent and 51 percent Year-over-year respectively.
