BEIJING (Reuters) - Inflation in China this year could touch 3 percent, a senior central bank official said on Sunday, compared with 2.6 percent last year.
Yi Gang, vice governor of the People’s Bank of China, also said the total amount of financing available to borrowers this year in China would be decided by the market, after growth in credit supply shot up in 2012.
“The level of inflation that we expect this year ... could be slightly higher than 2.6 percent, maybe around 3 percent,” Yi said ahead of a meeting of China’s annual parliament session.
“But generally speaking, we are still fully confident of controlling this year’s inflation,” he said.
Neither the central bank nor the government has announced inflation targets for this year. An influential state think-tank in January raised its 2013 inflation forecast to 3.5 percent.
The Chinese Academy of Social Sciences upped its forecast from 3 percent as it lifted its estimate of economic growth to 8.4 percent from 8.2 percent, citing rebounding activity.
Yi’s remarks underline the central bank’s growing focus on inflation. It signalled in February when it released its fourth-quarter monetary policy report that its policy priority had turned to inflation from economic growth.
A Reuters poll in January showed inflation this year was expected to tick up to 3.2 percent.
China’s annual inflation ran at 2 percent in January but analysts expect it to accelerate in coming months, in part due to low comparison figures from a year ago.
Some economists also warn of the risk of a price spike for pork, a staple meat for Chinese.
Yi declined to comment on who would be the next governor of the central bank.
Speculation was rife that Governor Zhou Xiaochuan would retire this year when he reaches 65 but sources told Reuters last month that he would keeping his job to help Beijing oversee China’s financial reforms.
Reporting by Cao Weihao and Koh Gui Qing; Editing by David Cowell