Financial Times FT.com

China vows to act on prices

By Richard McGregor in Beijing and Javier Blas in London

Published: January 9 2008 10:59 | Last updated: January 9 2008 19:01

China has vowed to “temporarily intervene” in the market to prevent excessive price rises for food and daily necessities, raising the spectre of an enlarged state role in the economy as part of an anti-inflation campaign.

The measures, announced on Wednesday by the State Council, China’s cabinet, come after sharp rises in inflation, which has hit 11-year highs, driven by higher food prices.

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