Prices in general will fluctuate with market supply and demand, raw material prices, labor costs, and the macroeconomic situation. In recent years, in the context of global economic recovery and policy stimulus, the phenomenon of price increases has become more pronounced.

1, fertilizer

For the majority of growers, fertilizer is just the cost of spending. And it so happens that the nitrogen inside the fertilizer and basically through the coal and natural gas to extract, and the rise of these raw materials, the price of fertilizer will naturally follow the rise.

2, semiconductor

Semiconductor chips as the supply chain and industry chain is highly globalized industry, since the epidemic, production and supply has been in a state of tension and imbalance. This, coupled with the international situation of conflict, has exacerbated the crisis in the chip industry. According to the State Administration of Market Supervision disclosed that the markup rate of some car chips is up to 4,543 percent.

3, gasoline

Gasoline prices are rising is very obvious, 92 gasoline once broke the eight dollar mark, 98 gasoline is up to nine dollars. And by the impact of the international environment, the price of gasoline did not stop the trend of continuing to rise.

4, natural gas

Currently, the international market price of natural gas has been as high as 2300 U.S. dollars / thousand cubic meters, so the domestic price of natural gas will follow the rise. I believe that many families have felt a significant price increase when paying their gas bills every month.

5, land prices and housing prices

Currently corn, soybeans and other food price quotations continue to maintain high levels, many areas of land rent has begun to usher in a substantial increase. For example, in the Northeast individual areas of the highest rent per mu has reached about 1500-1800 yuan. And the corresponding may also have the impact of housing prices, under the influence of rising costs of petroleum, chemicals, building materials, etc., may be on the price of housing directly reflected.

6, food prices

In recent years in the international market, food prices have been in an upward trend. Affected by previous epidemics and food shortages, many places are experiencing a shortage of food supply.

Professionals believe the reasons for this are threefold:

First, the prices of commodities such as airfare and hotels are particularly affected by market supply and demand.

Over the past three years, people's travel and entertainment have been suppressed, accompanied by plummeting incomes in travel agencies, airlines, bed and breakfasts and other related industries. Now that human needs are being rapidly unleashed, it's no surprise that market demand is high and prices are higher.

Second, the raw materials and costs of some commodities have risen, and their prices have naturally risen. Take mineral water, last year, international oil prices remain high, making the procurement cost of PET (a plastic material) become higher, coupled with the cost of cartons, labels, shrink film and other packaging materials, resulting in the first half of 2022 Nongfusanquan gross margin from the same period of the previous year's 60.9% down to 59.3%, the rise in the upstream costs, the price of bottled water naturally rise. And as early as McDonald's with a price increase before the concern, Haidilao, Xibei, Ruixiang coffee, tea Bai Dao and other food and beverage brands have raised prices. The reason for the price hike in the restaurant industry also points to higher raw material and labor costs.

Rising prices

According to the "2022 China Catering Industry Development Status Quo and Market Research and Analysis Report", the three costs that account for the highest proportion of food and beverage are the cost of raw materials (41.8%), labor costs (21.3%), and the three expenses (21.2%), with the cost of raw materials accounting for the highest proportion of the cost. However, on another level, this may be a good thing for consumers. The increase in costs, fierce market competition from a certain point of view can force businesses to improve.

With the economic development and the change of people's consumption concept, the price has long been the only indicator of consumer judgment, the quality of the meal, supporting services, dining environment, etc. constitute a comprehensive evaluation of a restaurant. Even if the price is high, a good experience will still make consumers feel worthwhile. On the contrary, the price is not low, but the meal or service environment is not characterized by the business will be eliminated by the market.

Third, people in different regions and with different needs perceive prices differently. People feel the source of the price increase in goods is more food, clothing, housing and transportation of these aspects, and China's CPI by food, tobacco, alcohol and supplies, clothing, household equipment, health care, transportation and communication, entertainment, education and culture, housing, which consists of eight categories. This year, the hotel and catering industry is up, but cars, electronic products and other goods are facing price cuts are still not high sales, in these areas, people's current demand potential to be further released.

And, prices are naturally different in different regions. The National Bureau of Statistics data show that in February, the national provinces CPI index for Jiangsu's highest 1.7%, the lowest for Guizhou's 0.3%, the same goods, the face of Jiangsu people complaining about high prices, Guizhou people may also issue a "I do not feel that the price increase ah" question.

Thus, our perception of prices is often limited and does not represent the real situation of the whole society.

To look at it from another angle, the price increase of some commodities, we can see the recovery of the tourism and catering industry, only to let the money flow in the market, so that it is injected into the entity, in order to truly drive economic development.

What are the effects of deflation?

Positive

Generally speaking, a moderate deflation, by intensifying market competition, will help adjust the economic structure and squeeze out the "bubble" in the economy, and also promote enterprises to strengthen technological inputs and technological innovation, and improve the quality of products and services, which will have a positive impact on economic development.

Negative

Unlike inflation, it is often difficult to achieve the goal of stimulating the economy by lowering interest rates in a deflationary state, and the stimulus effect of lower interest rates on investment and consumption is often constrained by expectations. Because in the deflationary environment, although the nominal interest rate level fell, but the real interest rate level is still very high, resulting in the high cost of investment, inhibit the investment behavior, and the consumer is expected to commodity prices will fall further, will reduce the immediate consumption, so that the price level continues to fall, and may therefore form a spiral of self-reinforcing vicious circle.

Deflation, like inflation, is a pathological feature of macroeconomic operations, both impede the normal operation of the macroeconomy, that is, both have their negative effects, especially the shrinking of aggregate demand deflation is more so. The negative consequences of deflation mainly focus on two aspects: one is to lead to economic recession, hindering the development of production and economic growth, causing more people to lose their jobs; the other is to narrow the regulatory space of monetary policy. Severe deflation often leads to recession.