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Beijing. Chinese Web users on Monday expressed anxiety about soaring consumer prices, despite a weekend interest-rate hike and the state’s reassurances that inflation could be curbed.

On Saturday the central bank raised interest rates for the second time in less than three months as authorities ramped up efforts to curb bank lending, rein in property prices and tame soaring inflation.

In a sign of Beijing’s awareness of mounting public concerns, Prime Minister Wen Jiabao addressed the nation via live radio on Sunday, acknowledging the hardships for citizens but insisting prices could be contained.

But on the Internet, used by about a third of China’s 1.3 billion people, citizens said they were not convinced by the state’s anti-inflation campaign and expressed fears about the future.

“I’m unable to pay back loans. Prices are high, gas prices were just hiked, the stock market is weak, my salary was cut significantly,” said one man using a microblogging service run by Web portal sina.com.

“I missed paying social insurance and family pressures are big. Everything is blowing up in my face and I’m suffocating,” the man added.

The rate hike was the second since mid-October, when policy makers raised rates for the first time in nearly three years as they try to slow a flood of liquidity which fanned inflation and drove up property prices.

The consumer price index, a key measure of inflation, topped 5 percent in November for the first time in more than two years as food costs soared 12 percent year-on-year. Analysts say more rate hikes will follow next year.

The state-run China Securities Journal said on Monday in a commentary that the weekend move on rates by the People’s Bank of China was a sign that official concerns on inflation had overtaken those about maintaining growth.

The benchmark Shanghai Composite Index closed down 1.90 percent after a morning rally, as investors booked profits amid concerns that further tightening measures would come next year.

On tianya.com, one user said of Saturday’s move by the central bank: “Our current economic policies are not meant to clean up excess money and direct the economy to stabilize, but to block up wherever the loopholes are.

“We are stuffing powder into the bombs that we bury for ourselves. Eventually the ordinary people will become the victims of those bombs.”

Ever fearful of inflation’s potential to spark unrest, authorities have been pulling on a number of policy levers to rein in consumer prices and cool the red-hot real-estate market.

Earlier this month the central bank ordered lenders for the sixth time this year to keep more money in reserve, limiting the amount of funds they could lend.

Despite this, bank lending has remained stubbornly high and property prices have continued to rise, frustrating first-home buyers who feel apartment prices are out of their reach.

Wen said on Sunday that recent price rises had “actually made life even more difficult for people on low and medium incomes.” But he said housing prices would come back down to a “reasonable level” and that the general level of prices could be controlled.

In a chat forum on the Web site of the Xinhua news agency, however, online users were less than receptive.

“The ordinary people are waiting to see whether the premier can live up to his promise,” one wrote. Another said: “Stop talking too much about what has been achieved over the past five years. We just want prices to come down in real terms.”
 

Agence France-Presse