Chinese economy undergoes "soft landing" able to curb inflation next year

Chinese economy is showing signs of a "soft landing" and it is likely the Chinese government will be able to keep inflation at a "reasonable" level next year, China Banking Regulatory Commission (CBRC) said.
CBRC said with the continuing effect of the government's macro control policies, China's economy is back on track for steady growth. It also pointed out that the current global liquidity floods and cross-border "hot-money" movements not only drove up prices of precious metals, energy, and resource commodities in international markets, but also led to over-speculation on farm produce such as mung beans and garlic in China's domestic market as well. China's consumer price index (CPI), a measure of inflation, accelerated to a 28-month high in November of 5.1%, well above the government's full-year target of 3%. Food prices account for one-third of China's monthly CPI calculations and contributed to three-quarters of November's year-on-year jump in inflation.
The Chinese policy-makers have repeated their words recently on curbing further rises of prices in the coming year, vowing to make stabilizing prices a priority for 2011. The People's Bank of China (PBOC), or the central bank, announced it would raise banks' reserve requirement ratio for the sixth time this year by 50 basis points to 18.5% beginning Dec. 20, the latest in a series of steps to steer money and credit growth back to normal in a bid to rein in inflation.
CBRC expected more volatility in commodity and asset prices next year as loose monetary policies in developed economies have fanned liquidity floods into emerging markets, where speculative funds are seeking returns higher than those available in developed nations, but China's ability to curb inflation is "relatively strong" and inflation can be kept in a "reasonable and acceptable" range next year.