ShaunReinportraitShaun Rein by Fantake via Flickr

The unusual fine of 2 million RMB (euro 200,000) for Unilever after announced prices rises caused a stampede, illustrates how inflation is becoming a headache for the authorities, Shaun Rein says in various comments.

“This is a very unusual measure. I think it is a way of scaring companies to think twice before they raise prices,” Shaun Rein, managing director of China Market Research Group in Shanghai, told AFP…
“Consumers feel it is much harsher… food prices from yoghurt to milk to eggs to cooking oil have gone up 10-20 per cent in the past six months,” said Rein.

In Market Watch:

The fine levied on Unilever reflects Beijing’s growing sensitivity about inflation numbers, according to China Market Research managing director Shaun Rein in Shanghai.
Government officials and company executives were also aware of the growing political sensitivity of the issue, Rein said.
“Last month’s leaks really upset certain folks, so everyone will probably be more tight-lipped,” Rein said.

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