China’s full-year inflation might exceed the country’s 2011 full-year target of 4 percent, judging from the current trend, said Zhang Xiaoqiang, deputy chief of the National Development and Reform Commission.

However, China will continue to put the inflation management as its top priority, Zhang said at a press conference on the sidelines of the Summer Davos in Dalian.

China’s consumer price index (CPI), a main gauge of inflation, eased to 6.2 percent year on year in August, from 6.5 percent in July, according to the National Bureau of Statistics (NBS).

The 4 percent was the country’s previous prediction for the full-year but it could be exceeded, judging from the current trend, he said.

Zhang said China’s grain output is expected to grow for an eighth consecutive year in 2011 and reach a recorded 560 million tons, which will ease the country’s inflationary pressure, Zhang said. Food price is regarded as a key contributor to the elevated CPI.

Other favorable conditions including China’s proactive fiscal policy and prudent monetary policy will ease the pressure of excess liquidity, but challenges exist, as China is still facing great imported inflation and rising costs of labor, land and environment in efforts to upgrade its economic structure.

Source:cnbusinessnews