In China, overheating investment and an infrastructural bottleneck arising, for example, from the paucity of the electricity supply, are pointed out as potential sources of risk, and policy measures have been implemented to address these issues. Meanwhile, the Chinese economy continues to expand strongly, underpinned by firm domestic and foreign demand.
As the strength in the corporate sector leads to further increases in employee income, it is natural to expect that supply and demand conditions for consumer goods and services will improve and that this will exert upward pressure on consumer prices.