China's war on inflation a threat to global recovery

Speaking on a trip to supermarkets in Inner Mongolia over the weekend, Mr Wen said: "The central government has taken a slew of steps to stabilise prices. We will put it higher up on our agenda."

Chinese inflation is at the highest rate for more than two years - 5.1pc - sparking fears in the government of social unrest as the price of food soars. China raised interest rates for the second time in three months on Christmas Day, lifing them 0.25 to 5.81pc.

Policymakers have also raised the amount of money banks must keep in reserve in an effort to restrain bank lending that has powered the economy but also driven up prices.

However, a clampdown by China on inflation threatens to slow the growth of the domestic and global economy, which has been heavily reliant on the strength of the world's second largest economy. Stock markets around the world slid after the country raised interest rates over Christmas.