China said its politically sensitive inflation rate accelerated in June to the highest level in three years, as the government struggles to rein in soaring food costs.
The country's consumer price index rose 6.4 per cent in June, the National Bureau of Statistics said in a statement, the highest level since June 2008 when the inflation rate reached 7.1 per cent.
The June reading -- higher than the 5.5 per cent in May and well above the government's annual target of four per cent -- is likely to fuel concern among policymakers anxious about inflation's potential to trigger social unrest.
China has been struggling to tame inflation despite restricting the amount of money banks can lend on numerous occasions and hiking interest rates five times since October -- most recently on Wednesday.
The price of pork, a staple of the Chinese diet, hit a new high in China last month due to rising costs and short supply, while severe flooding in crop growing regions of the country also fuelled inflation.
Fruit and vegetable prices in the eastern province of Zhejiang soared by as much as 40 per cent last month after heavy rains destroyed crops, state media said previously.
Premier Wen Jiabao reportedly admitted last month that it would be difficult to keep inflation within the government's target for 2011, but added fighting rising prices remained a priority.
The government has said it expects price pressures to ease in the second half.
Some analysts are concerned Beijing might go too far in tightening monetary policy and trigger a sharp slowdown in the world's second largest economy -- which could have dire consequences for the world.
Growth in China's manufacturing activity almost stalled in June and year-on-year auto sales have fallen for two straight months. (AAP)
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