China says inflation under control, but deflation a risk

Channel News Asia
China says inflation under control, but deflation a risk
Posted: 14 November 2008 1350 hrs

BEIJING: Inflation in China has been brought under control but deflation is now a risk, the nation's central bank vice governor said here Friday.

"The Chinese government has successfully brought under control the inflation issue," Yi Gang told reporters.

"The policies we are planning for the rest of this year and next year, including a proactive fiscal policy and a moderately easy monetary policy, are all aimed at effectively preventing possible deflation."

Inflation control was one of the Chinese government's top policy issues for most of this year, but amid the global financial crisis, the government has become increasingly concerned with stimulating spending and economic growth.

China's inflation rate hit a 17-month low of 4.0 per cent in October, down from 4.6 per cent in September and a 12-year high of 8.7 per cent in February.

- AFP/yt