China overhauls consumer price basket, with never-before-seen unveiling of its composition

Beijing has for the first time revealed the intricate composition of China’s consumer price index (CPI) basket, and a fresh recalibration sees it shift more weight towards services and new types of consumption goods.The basket adjustment itself, conducted every five years, comes as the Chinese leadership seeks to steer the world’s second-largest economy out of deflationary pressure while avoiding a prolonged Japan-style spiralling of prices.The National Bureau of Statistics (NBS) has “appropriately reduced” the weight of food prices in the basket to 17.2 per cent and that of housing to 22.1 per cent, according to its online statement on Wednesday.Conversely, it increased the weight of transport and communications to 14.3 per cent; education, culture and entertainment to 11.4 per cent; and healthcare to 8.9 per cent.No 2020 benchmarks were provided to measure the quantitative changes.“This is set to adapt to the latest changes in residents’ consumption structure, further improve the representativeness of the price index, and more accurately reflect changes in consumer market prices,” the statistics bureau said, adding that the calculations could be comparable internationally.To capture the digital economy’s growing influence on daily life, the survey sample expanded to 120,000 outlets, including membership-only warehouses and instant “flash-sale” retail platforms, the NBS explained.