China has no inflation problem because the current commodity prices hike were caused by supply shortage and not by an excessive amount of currency being issued, said Wang Guogang, head of institute of finance and banking at Chinese Academy of Social Sciences, at the academy's annual forum held on Thursday.

"If a country's consumer price index (CPI) is higher than three percent in six successive months, it can be defined as inflation by Western standards," Wang said. "But the price changes of agricultural products are not included when Western countries calculating their CPIs."

Agricultural products account for one third of the goods used to calculate China's CPI, he said, adding that the high prices of agricultural products were caused by this year's frequently occurring natural disasters.

Hu Xiaolian, deputy governor of the People's Bank of China, said that the country's short-term inflation pressure is not so bad.

The central bank will continue to monitor the market and implement more flexible measures to stabilize the prices, and hasn't ruled out the possibility of increasing the interest rates again, she said.

The central bank raised its benchmark one-year lending and deposit rates by 0.25 percentage points from Oct 20, the first hike in almost three years.

China's CPI rose 4.4 percent in October, a 25-month high, the National Bureau of Statistics said on Nov 11.

(chinadaily.com.cn November 12, 2010))