AN OUTSTANDING priority of the People's Bank of China is controlling prices and taming inflation and it will also "strictly" implement the tight monetary policy, the central bank said yesterday.

It reiterated that it would use multiple means to rein in the rapid growth in credit and improve the effectiveness of such measures, the central bank said in its quarterly monetary policy report on its Website yesterday.

China's consumer price index, the main gauge of inflation, rose 8.5 percent in April, rebounding from the 8.3 percent growth in March.

The country's money-supply expansion unexpectedly accelerated in April, adding pressure on the central bank to tame inflation. M2, the broadest measure, rose 16.9 percent last month, after gaining 16.3 percent in March.

The central bank may also use interest rate in "a proper way" to curb inflation, the statement said.

The central bank raised banks' reserve requirement ratio four times this year to 16.5 percent to freeze more money from lending. It also quickened the yuan's appreciation pace this year but did not raise interest rate.

The interest rate cut by the United States Federal Reserve has narrowed the space for China to raise interest rate to fight inflation. If China increases its interest rates while the US cuts rates, more capital may seek the interest spread and flow into China and add pressure for an economic overheating.

Economists and analysts expect the central bank will use quantitative measures like the reserve ratio as the main weapon to curb inflation. Shenyin & Wanguo Securities Co cut its forecast of interest rate rises from three times to one to two times this year.

The central bank raised the interest rates six times last year and the reserve ratio was increased 10 times.