Central bank, state council signal action on inflation

Combined statements by the People’s Bank of China (PBoC) and the State Council signaled that the government is increasingly concerned over price and asset bubble risks, Reuters reported. China raised interest rates last week for the first time in almost three years, which startled markets, and some economists believe another hike could be on the way before the year’s end. "We need to be vigilant about upward pressure on consumer prices," the PBoC said in its third-quarter report. Consumer price inflation hit a 23-month high of 3.6% in the year to September. Following a meeting to discuss economic plans for the fourth quarter, the State Council said that stabilizing prices of vegetables and daily necessities would be a priority, as would bringing property prices under control. It also warned that hoarding of agricultural commodities, particularly cotton, for speculative purposes would be severely punished.