CHINA'S inflation rate posted its fastest growth in more than a decade last month, driven by skyrocketing food costs, the National Statistic Bureau announced this morning.
Despite government austerity measures to stem consumer prices, the consumer price index, the main gauge of inflation, hit a year-on-year increase of 6.9 percent in November, surpassing October's record of 6.5 percent, the biggest monthly jump since the beginning of 1997, the bureau said.
The CPI grew 6.6 percent in urban areas and 7.6 percent in rural areas in November, the bureau said.
The combined CPI rose 4.6 percent in the first 11 months, said the statistics bureau.
Food costs, accounting for a third of the CPI basket, were the main driver of soaring inflation growth this year after increasing costs of foodstock pushed up meat prices.
Prices of food surged 18.2 percent year on year in November after rising 17.6 percent in October. Within the category, meat and poultry prices soared 38.8 percent last month, following October's 38.3 percent jump. Egg costs surged 10 percent and grain costs were up 6.6 percent.
The record inflation rise will add more pressure on the government to prevent price increases spreading beyond food.
China has asked banks to freeze the amount of money available for lending at its highest level for two decades in a move towards a "tight" monetary policy to cool the booming economy.
Chinese banks will have to put 14.5 percent of capital in the hands of central bank from December 25, an increase of 1 percentage point, the People's Bank of China announced on Saturday.
The rise in the reserve requirement, the 10th increase this year, and five interest rate rise in 2007, are among the central bank's efforts to curb credit amid a run-away stock market boom and rising property market.