China, even after high inflation and the collapse of the Lehman Bank, is introducing price controls, approved by the National Development and Reform Commission and 11 ministries, including the Ministry of Finance. China attaches great importance to controlling the price of basic groceries. Let’s take a look at it.
Price control, why?
Prices are prone to rise and fall. China has been keeping an eye on the price of basic food, constantly improving the mechanism of the cointrol. But why did China have to take this step? Recently, Beijing announced that inflation at factory level had reached a sharp rise in commodity prices, a full 9%, the highest figure since September 2008, roughly since the collapse of bank Lehman. Food price inflation is 1.65%, a slight increase. A year ago, food prices rose sharply in China and inflation was in double digits. According to China, there is no risk of a crisis if the consumer price index is subdued.
However the question we should ask is if China is starting to control food prices, it means that the food prices are rising globally. Even the largest and most influential central banks had to admit it, the latest one being american Fed, which registered increasing inflation above its inflation target. So what can you do to protect yourself from the impacts of the inflation, which is now rising everywhere?
How to protect yourself?
China is not the only one struggling on several fronts with rising prices. The whole world, which has been hit by the pandemic, will also struggle with rising prices. The fear of inflation is justified and thus people are looking for ways to protect themselves from inflation. One option is investment, although it requires a lot of study at the beginning. Another option is cryptocurrencies, which can serve as a store of value. If you’d like to learn more about cryptocurrencies and maybe even try working with them, contact us for more information.