Economy

China pricing official tries to ease concern over inflation

(Xinhua)
Updated: 2010-11-11 09:20

A Chinese government official Wednesday tried to ease public concern about soaring food prices, saying the government can prevent inflation from further accelerating.

"Though prices are rising, the government is experienced and has sufficient reserves to handle the situation and put inflation under control," Zhou Wangjun, deputy director of the Department of Prices with the National Development and Reform Commission (NDRC), said during an online interview with Chinese netizens.

Related readings:  China hit by imported inflation   CPI increase sparks worries  Interest raised to check inflation  Pay rises lag behind inflation

Zhou's remarks came one day before the release of the October consumer price index (CPI).

Many economists expect October year-on-year inflation to have risen to 4.1 percent. The September CPI figure hit a 23-month high at 3.6 percent.

The consumer price index will remain high in the fourth quarter, Zhou said, predicting that the ful-year CPI figure will exceed the government's target of 3 percent.

"Food price rises this year were not caused by food shortages," Zhou said, blaming "excessive liquidity" in the market for mounting inflationary pressures.

He said, the NDRC, China's top economic planner, will take a series of measures to keep CPI growth at a reasonable level for urban residents and ordinary consumers.

The measures include focusing on agricultural production, guaranteeing market supply, subsidizing low-income groups and enhancing supervision to prevent speculation on the price of essential daily items.

For the year, Zhou projected 10 percent growth in gross domestic product (GDP) and a CPI figure slightly above 3 percent.

Zhou also said stagnation next year is unlikely given the current robust economic momentum.