The ugly scourge of inflation plays with Australia , China and India

Inflation, as measured by the Consumer Price Index (CPI) has been heading higher over recent months. During the three months to June 2011, headline inflation was recorded at 0.9% in comparison, property values across the combined capital cities fell by -1.5%. Inflation has become a prime concern now for fast growing economies like  India,  China but also developed economies like AUSTRALIA

Inflation and  Australia sectors

There are sev eral ways in which inflation can be measured. The most common is by reference to a consumer price index (CPI) which measures the changes in prices of a basket of goods and services purchased by a representative set of households. The CPI is a narrow measure of inflation and does not measure changes in the prices of other goods and service.  A much broader indicator of inflation is provided by the GDP deflator, and this is the much more popular  inflation measure used.

Some countries calculate their volume estimates of government consumption by deflating their current price estimates using representative input price indexes, while others weight together output indicators for services provided by hospitals, schools, etc.

In india Government data Tuesday showed July inflation at 9.22% from a year earlier and authorities warn it would hover between 9% and 10% till December. Economists widely predict a further 0.50 percentage point increase by next March as inflation is above the central bank’s comfort level.

The inflation rate in India was last reported at 8.62 percent in June of 2011. From 1969 until 2010, the average inflation rate in India was 7.99 percent reaching an historical high of 34.68 percent in September of 1974 and a record low of -11.31 percent in May of 1976

China and inflation

China’s annual housing inflation quickened in July for the second straight month this year, official data, keeping up pressure on Beijing to rein in the red-hot property sector.Many international and chinese economists have warned that a bursting of a property bubble is the biggest risk facing the world’s second-largest economy in the medium to long term.

In this short term period, rising house prices are driving up China’s consumer inflationdangerously, which accelerated to 6.5% in the year to July from June’s 6.4%. China’s average new home prices rose 4.3% in July from a year earlier, an uptick from an annual rise of 4.2% in June and 4.1% in May