BEIJING, April 15 (UPI) -- China's March inflation rate soared to 5.4 percent year-on-year, but first-quarter economic growth eased to 9.7 percent, the government said Friday.
The consumer price index rose to a 32-month high of 5.4 percent in March from the same month last year, said the National Bureau of Statistics, which largely blamed rising food prices for the increase.
The March number brought the first-quarter inflation rate to 5 percent year-on-year, far higher than the government's target of 4 percent or less. The agency said food prices surged 11 percent year-on-year.
In February, the CPI rose 4.9 percent year-on-year. The CPI rose 3.3 percent for all of 2010, against the government's target of 3 percent.
One analyst told the official Xinhua news agency the current inflationary pressure was expected to persist for some more time, which would force the central bank to again raise interest rates as well as the reserve requirement ratio.
The statistics bureau said first-quarter economy grew 9.7 percent year-on-year, to $1.46 trillion, but slightly down from the 9.8 percent growth in the fourth quarter of 2010. Chinese Premier Wen Jiabao said this week keeping price levels stable is the most urgent task for the government this year, Xinhua said.
"Judging from the inflation situation in the first quarter, we are still under great pressure of price hikes," Wen said, adding, "We should never lower our guard."
The People's Bank of China, China's central bank, has raised interest rates four times since the start of 2010. The bank, in its efforts to mop up excessive liquidity, has raised the reserve requirement ratio for commercial banks nine times since that time.
