China has its inflation problems under control and doesn't plan to hike interest rates in near future, dousing speculation that central bank might raise rates to stem soaring investment. 
 
China has its inflation problems under control and doesn't plan to hike interest rates in the immediate future, dousing speculation that the central bank might raise rates to stem soaring investment.

Recent surges in prices to seven-year highs are a "sign of recovery" from relatively low prices in recent years - and do not signal that inflation will spiral out of control.

The consumer price index, a key inflation barometer, jumped to 4.4 percent in May as prices for food, housing and utilities increased significantly.

The producer price index - the price of goods when they leave the factory - rose 5.7 percent in the largest increase since late 1996.

The People's Bank of China plans to wait at least three more months before considering a raise in interest rates.

Earlier, central bank officials had said a hike in rates would be considered only if the consumer price index exceeds 5 percent.

(CRI June 17, 2004)