China's central bank governor, Zhou Xiaochuan, said on Wednesday that surging
domestic consumer prices and recent U.S. interest rate cuts would
have "considerable influence" on Chinese monetary policy.
The central bank, the People's Bank of China (PBOC), would
"seriously consider" the situation, added Zhou.
Zhou made the remarks at a news briefing on the sidelines of the
Third China-U.S. Strategic Economic Dialogue (SED) held in Beijing.
The two-day event began on Wednesday.
Increases in the consumer price index (CPI) had been mainly
driven by soaring food prices, Zhou said. Whether and how the CPI
could be curbed through monetary policy was being studied, Zhou
said, admitting that the issue could be contentious.
China's consumer price index (CPI) for November rose 6.9 percent
from a year earlier, according to statistics released from the
National Bureau of Statistics (NBS) on Tuesday morning.
The figure showed that inflationary pressures were persisting,
and it triggered concern about further tightening measures.
As to the recent interest rate cuts by the U.S. Federal Reserve,
Zhou said China concerns the possible indirect impact on the
country, which already had excess liquidity in the capital
market.
The governor also said that China backed a strong dollar and
would back U.S. efforts to recover from the sub-prime credit
crisis.
(Xinhua News Agency December 13, 2007)
